US construction starts tumble 6% in August

ConDig (24-Sept-19).  US construction starts took a 6% dip in August in the wake of a collapse in the nonbuilding sector, according to latest figures from Dodge Data & Analytics. 

The fall pushed starts to a seasonally adjusted annual rate of $807.1 billion, down from $858.7 billion the month prior. 

It comes amid a 15% crash in nonbuilding construction sector to $217.3 billion in August from $256.4 billion the month before. Environmental public works (drinking water, sewers, hazardous waste, and other water resource projects) fell 43% in August, while miscellaneous nonbuilding fell 32%. Both types of construction had shown remarkable strength in July as work on several large projects got underway, Dodge Data & Analytics noted. Offsetting these declines was a 10% increase in street and bridge projects. The electric utility/gas plant category also gained 9% over the month.

The nonresidential sector fell 3% to $283.9 billion from $292.9 billion, while starts in the residential sector dipped 1% to $305.7 billion from $309.3 billion.

For the year-to-date, total construction starts were 5% lower than the same period a year ago to due to declines in residential and nonresidential buildings. Nonbuilding construction activity was 3% higher through the first eight months of the year due to gains in electric utilities/gas plants.

“The August decline was expected after July’s robust level of starts,” said Richard Branch, chief economist for Dodge Data & Analytics. 

“Furthermore, the year-to-date activity continued to suggest that this year’s levels are easing back from what was seen in 2018 – essentially mirroring the slowdown in overall economic growth.”

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