May Construction Spending

Updated 01-Jul-09 10:59 ET

Highlights

Construction spending declined -0.9% in May (consensus -0.8%) and increased 0.6% in April, which was revised from a 0.8% increase, according to the Department of Commerce.
Private construction in the month of May declined -1.0% from the revised April estimate while public construction was -0.6% below the revised April estimate.
In the private area, residential construction dropped -3.4% from April to a seasonally adjusted annual rate of $240.2 billion. Nonresidential construction, however, jumped 0.5% to a seasonally adjusted annual rate of $409.0 billion.
Total private construction is down -17.4% year-over-year. Accounting for the revisions, private construction has declined every month this year with the exception of April. Private residential construction has declined every month.

The offset has been nonresidential construction. It is down -3.3% year-over-year, but has risen every month this year. The Q2 average of $407.9 billion for nonresidential construction in the private area is 2.3% above the Q1 average, which will be somewhat of a mitigating factor in Q2 GDP estimates.

These data gets less attention than deserved. The data go directly into the GDP report. Residential construction has dropped to about 3% of GDP, while nonresidential construction is about 4% of GDP.

Category	MAY	APR	MAR	FEB	JAN
Nominal (Current) Dollars
Total Construction	-0.9%	0.6%	-0.4%	-0.4%	-3.4%
Private	-1.0%	0.8%	-1.6%	-1.9%	-4.2%
Residential	-3.4%	0.0%	-4.6%	-6.4%	-4.0%
Nonresidential	0.5%	1.3%	0.4%	1.3%	-4.3%
Public	-0.6%	0.2%	2.2%	3.0%	-1.7%