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Construction Spending: Decline Mostly Due to Upward Revisions in March

June 1, 2017
Bottom Line: Just like last month, construction spending in the most recent month was reported to have declined, almost entirely due to upward revisions in the prior month. Positive revisions in March suggest construction spending in the 1st Quarter of 2017 grew at a 12% annual pace, indicating potential upward revisions to Q1 investment. The last twelve months have seen construction spending grow at a 6.7% rate, sharply higher than 2016's 4.9% pace but still below the pace of 2015 and the 5-year average . Residential construction continues to drive gains, while non-residential construction growth is modest and public construction spending continues to decline.

Construction Spending FELL by 1.4% in April, compared with market expectations for an increase of 1.0%.

The March estimate was revised moderately higher from -0.2% to 1.1%, while the February, estimate was revised slightly higher from 1.8% to 1.9%.

Construction spending is now 6.7% ABOVE its year ago level but still 1.4% below its March 2006 peak.

Residential Construction FELL by 0.7%, Homebuilding is now 16.0% ABOVE its year ago level.

Nonresidential Construction FELL by 0.6%. Nonresidential construction growth is now 4.3% ABOVE its year ago level.

Public Construction FELL by 3.7%, and is now 4.4% BELOW its year ago level.