US construction up +3.3% in year to October

Construction spending in the US was up +3.3% in the 12 months to the end of October, compared to the same time last year, at US$ 971 billion. This was a +1.1% increase from the 12-month rolling total to the end of September.

The year-on-year increase was driven by the private non-residential sector, which was up +6.4% compared to a year ago. However, this component of construction was down -1.0% compared to the previous month.

Other growth areas included private residential construction, which was up +1.9% compared to a year ago, and +1.3% compared to the previous month. However, these gains were undermined by the public construction sector, which was down -2.3% compared to a year ago. However, it was up +1.5% compared to the previous month – the biggest month-on-month gain for any segment of the industry.

Commenting on the figures from the US Census Bureau, Ken Simonson, chief economist at the Associated General Contractors of America (AGC) said, "While overall construction spending jumped by more than +1% in October, the gain followed two months of stagnation. Public construction was the fastest-growing segment for the month but the slowest-growing over the past year and for the first 10 months of 2014 combined.

“Conversely, private non-residential construction inched down from September to October but has risen at double-digit rates - +11% - for the combined January through October period. And private residential construction continues to grow very modestly, with multifamily construction taking the lead on an annual basis."

He added, "For 2014 as a whole and 2015, private non-residential spending and multifamily spending should be the strongest segments, followed by single-family construction, with very limited prospects for public construction."