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Construction Spending unchanged in August

From the Census Bureau reported that overall construction spending was “virtually unchanged”:

Construction spending during August 2021 was estimated at a seasonally adjusted annual rate of $1,584.1 billion, virtually unchanged from the revised July estimate of $1,584.0 billion. The August figure is 8.9 percent above the August 2020 estimate of $1,455.0 billion. During the first eight months of this year, construction spending amounted to $1,034.5 billion, 7.0 percent above the $966.7 billion for the same period in 2020.
emphasis added

Private spending decreased and public spending increased:

Spending on private construction was at a seasonally adjusted annual rate of $1,242.2 billion, 0.1 percent below the revised July estimate of $1,243.7 billion. …

In August, the estimated seasonally adjusted annual rate of public construction spending was $341.9 billion, 0.5 percent above the revised July estimate of $340.3 billion.

Construction Spending Click on graph for larger image.

This graph shows private residential and nonresidential construction spending, and public spending, since 1993. Note: nominal dollars, not inflation adjusted.

Residential spending is 16% above the bubble peak (in nominal terms – not adjusted for inflation).

Non-residential spending is 10% above the bubble era peak in January 2008 (nominal dollars), but has been weak recently.

Public construction spending is 9% above the peak in March 2009, but weak recently.

Year-over-year Construction SpendingThe second graph shows the year-over-year change in construction spending.

On a year-over-year basis, private residential construction spending is up 24.3%. Non-residential spending is down 2.3% year-over-year. Public spending is unchanged year-over-year.

Construction was considered an essential service during the early months of the pandemic in most areas, and did not decline sharply like many other sectors. However, some sectors of non-residential have been under pressure. For example, lodging is down 30.7% YoY, multi-retail down 2.0% YoY (from very low levels), and office down 4.2% YoY.

This was below consensus expectations of a 0.3% increase in spending, however construction spending for the previous two months was revised up slightly.

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