In a further sign of slow economic recovery, the nation’s nonresidential construction spending inched up 0.1 percent in May, according to the July 2 report by the U.S. Commerce Department. On a year-over-year basis, nonresidential construction spending was down 2.9 percent in May, with spending totaling $546.3 billion on a seasonally adjusted, annualized basis.
A 1.8-percent increase in public nonresidential construction spending barely offset the impact of a 1.4-percent decline in spending on privately financed nonresidential construction projects. Private nonresidential construction spending is down 0.9 percent, while public nonresidential construction spending is down 4.9 percent.
Residential construction spending increased 1.2 percent for the month and is up 22.7 percent compared to the same time last year.
Total construction spending—which includes both nonresidential and residential spending—was up 0.5 percent for the month and is up 5.4 percent from May 2012.
“For much of the past year, privately financed activities have been recovering in conjunction with the nation’s moderate economic recovery, while publicly financed construction had been in decline—a reflection of constrained public capital budgets,” said Associated Builders and Contractors chief economist Anirban Basu.