Spending on both private and public construction increased in July, reaching a seasonally adjusted annual rate of $981.3 billion. That’s more than 8 percent higher than last July’s rate.
The report “provides further evidence that a vigorous nonresidential construction recovery is finally at hand," said Anirban Basu, chief economist for Associated Builders and Contractors. "Increased job growth, booming energy production, expanding industrial production and normalizing capital markets are all contributing to nonresidential construction's renewed momentum, and confidence among developers and other significant consumers of construction services is high, signaling ongoing recovery.”
Ken Simonson, chief economist for the Associated General Contractors of America, said “private nonresidential construction should remain strong through the rest of 2014 and beyond, while residential spending is likely to keep growing, though at a more moderate pace.”
Simonson’s one cautionary note: “Funding is still inadequate for needed public infrastructure improvements.”
Manufacturing construction is up 25 percent, and office construction is up 20 percent.
Construction is down compared with a year ago in health care, education and communications.
Aritcle by: Kent Hoover
Washington Bureau Chief