ConDig (01-May-17). US construction spending dipped 0.2% in March to $1.218 trillion from a record high of $1.22 trillion reached in February, but was up was slightly on the $1.138 trillion in the same period last year, according to latest figures from the Commerce Department.
Spending over the first three months of this year was up 4.9% compared with the January to March period of last year.
The fall comes as spending in the private nonresidential sector dipped 1.3% in March, but was up 6.4% year-to-date. The largest private nonresidential segment in March was power construction (including oil and gas pipelines), which fell by 0.6% for the month, but is up 8.2% for the year-to-date.
Private residential construction spending edged up by 1.2% in March and is now at the highest level since June 2007. It was also up 7.5% for the year-to-date, while spending on multifamily residential construction rose by 2% for the month and is up 7.4 percent year-to-date.
Public construction spending edged 0.9% lower from the month prior and is now down by 6.5% for the first three months of this year.
The biggest public segment—highway and street construction—edged up 0.5% for the month but was down 2.4% so far this year. The other major public category—educational construction—fell by 2% in March and by 2.6% for the first three months.
“Construction spending totals during the past two months are at the highest levels we have ever seen,” said Stephen E. Sandherr, ceo of the Associated General Contractors of America (AGC).
“If the winter weather hadn’t been so mild in much of the country, we would have seen less growth in February and a higher rate of growth in March, but overall demand remains quite robust.”
AGC also noted that the decline in public construction spending underlines the need for a new infrastructure plan for the country, similar to the one currently being drawn up by the Trump administration.
President Donald Trump said this week that a new infrastructure plan, which could total around $1 trillion, is “largely completed” and could be filed in the next two to three weeks, according to reports.
“If Washington officials can find a way to enact significant new infrastructure funding, we are likely to see even higher record levels of construction spending for the foreseeable future,” said Sandherr.
Trump’s wide ranging plan to upgrade the nation’s aging highways, airports and bridges could be rolled out over the next decade.