Construction Spending Moves Higher in October
Residential Increases, Nonresidential Declines
Construction spending increased 0.5 percent in October, versus September's estimate, to a seasonally adjusted annual rate of $1.173 trillion, the Census Bureau reports.
October's result is a jump of 3.4 percent year-over-year, and is 4.5 percent higher on a year-to-date basis, compared to the same 10-month time frame in 2015.
Construction Dive said construction spending "surged" in October, and that it is at the highest construction spending level since March 2016.
However, the Wells Fargo Economics Group reports that "the pace of spending slowed to start Q4," after private nonresidential spending rose solidly in the third quarter.
Reuters reports that the October increase is in line with economists' predictions, while Construction Dive said the Census Bureau's spending numbers for August and September have been adjusted and are now significantly higher, a sign that the industry has been stronger than expected in recent months.
Under total construction spending, residential was up 1.8 percent in October, and is 4.6 percent higher year-over-year. Nonresidential fell 0.3 percent for the month, but is up 2.6 percent compared to a year ago. Nonresidential subsectors with the largest gains and losses: religious (-10.6%); manufacturing (-2.7%); conservation and development (+6.8%); public safety (+9.1%); communication (+3.8%).
The Census Bureau's construction spending report for November will be released Jan. 3, 2017.