New construction starts in June advanced 9% from the previous month to a seasonally adjusted annual rate of $832.7 billion, according to Dodge Data & Analytics. The increase followed the 10% gain reported for May, as total construction starts continued to strengthen following April’s subdued performance.
By major sector, much of the lift in June came from a 16% jump for nonresidential building, which reflected the start of the $1.1 billion expansion to Terminal 5 at Chicago’s O’Hare International Airport, as well as sharp gains for office buildings, public buildings (detention facilities and courthouses), healthcare facilities and warehouses. The other two major sectors registered moderate growth in June, with nonbuilding construction up 6% and residential building up 5%.
Through the first six months of 2019, total construction starts on an unadjusted basis were $378.8 billion, down 8% from the same period a year ago. On a 12-month moving total basis, total construction starts for the 12 months ending June 2019 were 4% below the amount for the 12 months ending June 2018.
“The improved activity during May and June suggests that the gap relative to last year should narrow in coming months,” says Robert A. Murray, chief economist for Dodge Data & Analytics.