Construction spending tumbles to 10-year low in December
Construction spending tumbled 2.5 percent in December to a $788 billion seasonally adjusted annual rate, the lowest level in a decade, the Associated General Contractors of America noted Feb. 1 in an analysis of new Census Bureau data. All three major components – private residential, private nonresidential and public construction – shared in the decline.
“The outlook for 2011 is very mixed,” said Ken Simonson, the association’s chief economist, in a Feb.1 AGC of America release. “Spending on rental housing, warehouses, hospitals and factories should pick up. Power construction should stay strong, and federal dollars for stimulus and base realignment or ‘BRAC’ projects will continue to sustain some contractors. But public school construction and other state and local projects will keep shrinking, while single-family home-building, retail and office construction are likely to remain feeble.”