Construction starts fell only 1.5% in September from August after adjusting for the large seasonal decline typical at the end of the summer. This is consistent with the Reed Construction Data forecast that starts will slip very slowly lower into the winter and that construction spending will dip slightly more by year-end.

After seasonal adjustment, non-residential building starts fell 1% in September from August, heavy project starts fell 17% and residential starts rose 22%. The residential gain was mostly for single-family construction. The housing recovery will continue at a more modest pace for the rest of the year. The large drop in the heavy market was largely sharp cutbacks after an August surge in the stimulus funded highway and water …