Construction Forecasts

News & Analysis

Heavy Construction Spending Declined 0.4% in April

06/07/2011 by Jim Haughey, RCD Chief Economist

Heavy construction spending declined 0.4% in April, the fifth consecutive month to month drop. A large gain in power construction spending prevented the April decline from pushing over 1%. The gain in power construction is off trend with the expected slipping of power construction activity through 2012 as federal subsidies are cut sharply. Overall, heavy spending is expected to be sluggish through 2012 but will recover to the 2009 level next year. Congress appears committed to maintain but not to increase highway funding through 2012. Average growth in the private economy has set off recovery in the communications market and will initiate recovery in the water and sewer market early in 2012.

Heavy construction spending is forecast to decline 2.7% in 2011 and then rise 4.0% in 2012.

U.S. Non-building (Heavy Engineering) Construction
(billions of U.S. current dollars)

  Monthly Figures*
(latest actual values)
Annual Figures
  Actual Forecast
  Mar-11 Apr-11 2007 2008 2009 2010 2011 2012
Transportation (% change is period
versus same period, previous year)
39.531 37.752 31.697 35.457 38.090 39.659 38.396 40.425
-7.2% -11.9% 13.6% 11.9% 7.4% 12.3% -3.2% 5.3%
Communication 17.371 18.145 27.490 26.537 19.711 17.983 18.356 20.333
  4.6% 0.2% 23.6% -3.5% -25.7% -8.8% 2.1% 10.8%
Power 80.599 82.609 65.955 80.411 88.627 82.110 80.671 77.000
  16.9% 11.8% 56.2% 21.9% 10.2% -7.4% -1.8% -4.6%
Highway 78.804 77.503 76.727 57.241 81.578 82.523 80.127 86.075
  -0.4% -5.7% 6.9% 5.3% 1.0% 1.2% -2.9% 7.4%
Water and Sewer 36.955 36.306 40.655 42.494 40.106 40.782 37.850 41.713
  -5.6% -9.4% 6.6% 4.5% 91.0% 1.7% -7.2% 10.2%
Conservation & Development 6.982 6.828 5.252 5.246 5.633 6.752 7.15342 7.550
  14.3% 4.6% 3.0% -0.1% 7.4% 19.9% 5.9% 5.5%
Total 260.242 259.143 247.776 270.937 273.745 269.808 262.554 273.095
  -0.3% 0.0% 19.5% 9.3% 1.0% -1.4% -2.7% 4.0%

* Monthly figures are seasonally adjusted at annual rates (SAAR figures).
The total includes some miscellaneous buildings.
Actuals: U.S. Census Bureau, Department of Commerce (put-in-place investment figures).
Forecasts and table: Reed Research Group.


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