Nonresidential building construction spending fell 1.5% in January after increasing 1.2% in December. However, comparing January 2012 to January 2011, spending was up 9.2%.
“For lease” private projects spending dropped 2.0% following a 0.8% decline in December. On a year-over-year basis, for lease spending increased 3.9% in January. All three components of for lease construction projects (lodging, office, and retail) fell for the second month in a row. But from January 2011 to January 2012, office and retail construction spending were up — 1.5% and 7.7%, respectively. Hotel construction was down 2.4% over the same period.
Construction spending for institutional projects inched up 0.1%, after rising 0.9% in December (revised up from
-0.2%). Health care construction spending rose for the third month in a row, up 0.9%. On a year-over-year basis, health care was up 10.3%, while total institutional construction was up 6.2%.
Ending a string of six monthly increases, manufacturing construction spending fell 6.3% in January. December’s originally reported jump of 13.4% was revised down to a 6.7% increase. Comparing January 2012 to January 2011, manufacturing construction spending was still up a strong 38.4%.
Developments in Europe and the threat of even higher oil prices for a sustained period are the chief risks to the forecast. Nonetheless, the expectation is for spending totals to strengthen throughout 2012 and 2013 as the economy continues to grow and companies expand in response to growing demand. Low long-term interest rates continue to be a positive for investment in plant and equipment. Increasing domestic demand and greater exports to Asia and South America are expected to more than offset the likely slowdown in exports to Europe.
The forecast is for nonresidential construction spending to increase 5.8% in 2012 and to strengthen in 2013, advancing 8.3%.
U.S. Nonresidential Construction |
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| Monthly Figures* (latest actual values) |
3-Month Moving Average |
Actual | Forecast | |||||||||
| Nov-11 | Dec-11 | Jan-12 | Nov-11 | Dec-11 | Jan-12 | 2008 | 2009 | 2010 | 2011 | 2012 | 2013 | |
| Lodging | 8.808 | 8.706 | 8.369 | 8.638 | 8.654 | 8.628 | 35.806 | 25.499 | 11.329 | 8.554 | 8.936 | 9.819 |
| Month-over-Month % Change | 4.3% | -1.2% | -3.9% | 1.1% | 0.2% | -0.3% | ||||||
| Year-over-year % Change (NSA) | -12.8% | -12.4% | -2.4% | 24.7% | -28.8% | -55.6% | -24.5% | 4.5% | 9.9% | |||
| Office | 35.363 | 34.920 | 34.469 | 34.882 | 34.866 | 34.917 | 68.563 | 51.908 | 37.573 | 34.516 | 36.765 | 40.562 |
| 3.1% | -1.3% | -1.3% | 1.1% | 0.0% | 0.1% | |||||||
| 0.7% | -0.6% | 1.5% | 5.1% | -24.3% | -27.6% | -8.1% | 6.5% | 10.3% | ||||
| Commercial (mainly retail) | 44.312 | 44.123 | 43.130 | 44.252 | 43.980 | 43.855 | 86.212 | 54.069 | 40.522 | 43.559 | 44.813 | 48.396 |
| 1.9% | -0.4% | -2.3% | -1.3% | -0.6% | -0.3% | |||||||
| 14.0% | 13.6% | 7.7% | -3.9% | -37.3% | -25.1% | 7.5% | 2.9% | 8.0% | ||||
| Health Care | 40.376 | 40.963 | 41.326 | 40.014 | 39.985 | 40.888 | 46.902 | 44.845 | 39.879 | 39.957 | 42.466 | 46.285 |
| 4.6% | 1.5% | 0.9% | -0.2% | -0.1% | 2.3% | |||||||
| -1.2% | 2.1% | 10.3% | 7.2% | -4.4% | -11.1% | 0.2% | 6.3% | 9.0% | ||||
| Education | 86.185 | 87.185 | 86.822 | 86.434 | 86.490 | 86.731 | 104.890 | 103.202 | 88.227 | 84.797 | 87.535 | 92.306 |
| 0.1% | 1.2% | -0.4% | 0.1% | 0.1% | 0.3% | |||||||
| 3.0% | 4.7% | 6.0% | 8.4% | -1.6% | -14.5% | -3.9% | 3.2% | 5.5% | ||||
| Religious | 3.775 | 3.880 | 3.744 | 3.987 | 3.899 | 3.800 | 7.225 | 6.192 | 5.208 | 4.136 | 3.942 | 4.225 |
| -6.6% | 2.8% | -3.5% | -3.7% | -2.2% | -2.5% | |||||||
| -25.2% | -20.3% | -22.8% | -4.2% | -14.3% | -15.9% | -20.6% | -4.7% | 7.2% | ||||
| Public Safety | 10.455 | 10.433 | 10.460 | 9.983 | 10.185 | 10.449 | 13.083 | 13.787 | 11.118 | 9.972 | 10.476 | 10.682 |
| 8.2% | -0.2% | 0.3% | 0.7% | 2.0% | 2.6% | |||||||
| 3.1% | 8.2% | 8.7% | 28.3% | 5.4% | -19.4% | -10.3% | 5.1% | 2.0% | ||||
| Amusement/Recreation | 15.874 | 15.656 | 15.977 | 15.956 | 15.794 | 15.836 | 21.829 | 19.404 | 16.959 | 15.539 | 16.451 | 17.589 |
| -1.4% | 2.1% | 0.6% | -1.0% | 0.3% | ||||||||
| -7.5% | -3.4% | 4.4% | 2.9% | -11.1% | -12.6% | -8.4% | 5.9% | 6.9% | ||||
| Manufacturing | 41.189 | 43.957 | 41.197 | 40.871 | 42.002 | 42.114 | 53.234 | 56.836 | 38.106 | 37.087 | 42.987 | 48.876 |
| 0.8% | 6.7% | -6.3% | 0.8% | 2.8% | 0.3% | |||||||
| 28.3% | 41.7% | 38.4% | 31.0% | 6.8% | -33.0% | -2.7% | 15.9% | 13.7% | ||||
| Total** | 286.337 | 289.823 | 285.494 | 285.017 | 285.855 | 287.218 | 437.744 | 375.742 | 288.921 | 278.117 | 294.370 | 318.741 |
| 1.8% | 1.2% | -1.5% | 0.1% | 0.3% | 0.5% | |||||||
| 5.0% | 8.0% | 9.2% | 8.4% | -14.2% | -23.1% | -3.7% | 5.8% | 8.3% | ||||
* Monthly figures are seasonally adjusted at annual rates (SAAR figures). |
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Read more forecasts from Reed Construction Data:
Construction Spending Begins the Year on a Downer
Heavy Engineering (Non-Building) Construction Spending Slips in January
New Residential Construction Spending Continues to Improve
