ConDig (02-Apr-18). Construction spending rose 1% in February from the month prior to $1.32 trillion on a surge in public construction expenditure, according to latest figures from the Commerce Department.
Public construction spending jumped 3.6% for the month to $325.8 billion and 11.5% year-over-year as highway and street construction expenditure soared 9.5% from the month prior and 22.8% from a year ago. Educational construction, the next-largest segment, rose 5.5% year-over-year.
Private nonresidential spending, however, dropped 0.5% for the month to $453.6 billion and inched up 0.1% from a year ago, while residential expenditure edged up 0.7% from January to $546.5 in February, but declined 3.4% from a year earlier.
“The spending increase in February follows an extremely strong 2.5% gain in January, which aligns with contractors’ reports that they were busy early in the year and expect to stay that way through 2019,” said Ken Simonson, chief economist at the Associated General Contractors. “The major challenge they face is finding enough workers.”
Among the largest private nonresidential segments, power construction gained 1.4% year-over-year; commercial construction declined 6.6%; manufacturing construction increased 3.4% and office construction rose 4.8%.
Among residential segments, new multifamily construction spending rose 7.5% year-over-year but new single-family construction spending decreased by 7.1%, while improvements slipped 1.5%.
“Contractors nationwide report difficulty finding enough workers to keep pace with the strong demand for projects,” said Stephen E. Sandherr, AGC executive officer. “Expanding high school career and technical education programs will expose students to the rewarding career paths offered by high-paying construction jobs.”