Construction spending increased 0.6% in August to a seasonally adjusted annual rate of $915 billion, according to a Commerce Department report (link opens as PDF) released today.
After increasing a revised 1.4% in July (a substantial upward revision from the originally estimated 0.6% growth), analysts were pleasantly surprised by August's boost, having expected a milder 0.4% bump. Compared to August 2012, this latest rate is 7.1% higher.
Overall construction activity climbed to the highest level in more than four years.
Source: Commerce Department.
Private construction work provided the main push for the month's gain, increasing 0.7% to a seasonally adjusted annual rate of $641 billion. While nonresidential construction increased just 0.1%, residential construction grew 1.2% to an annual rate of $340 billion. The housing increase included a 1.6% rise in single-family construction and a 3.2% increase in the smaller apartment sector.
While neither amounting to nor gaining as much as private construction, public works managed to squeeze out a significant 0.4% gain to a $275 billion rate, spurred higher mostly by a 1.3% uptick in educational construction. There was a 0.8% increase in state and local government activity offsetting a 3.8% drop in spending on federal projects, which fell to their lowest level since June 2008.
So far for 2013, overall construction spending is up 5.9% compared to the same period in 2012.
-- Material from The Associated Press was used in this report.
