WASHINGTON — Construction spending saw a 0.1% increase in February, below expectations for a 0.5% gain, due to public construction falling 2.1% while private offset the negative with a 0.7% rise, data released by the Commerce Department Monday morning showed.
Analysts surveyed by MNI had expected total construction spending to rise by 0.5%, adding to January's flat reading. January construction was unrevised at a flat reading, while December was revised up to a 1.6% increase from the 0.8% increase previously reported.
Private nonresidential construction increased by 1.5% in February. The categories within were mixed, with increases in most. There were strong gains in office (+6.5%) and educational (+5.3%). However, there were declines in health care (-2.2%), religious (-2.6%), transportation (-1.3%), and communication (-3.0%).
Softening the 1.5% gain in nonresidential private construction, private residential construction spending saw a muted 0.1% rise in the month, while home building ex. new homes, also known as remodeling, fell 1.5% according to an MNI calculation. Also based on an MNI calculation, new homes saw a 1.0% rise. Single-family building rose 0.9%, while multi-family building posted a 1.2% increase from January.
Public construction spending declined by 2.1% in February after January saw an upward revision to a 2.3% increase from the 1.8% rise previously reported.
The decline in public construction spending was reflective of an 11.9% decline in Federal construction spending and a 1.0% decrease in the larger State and Local construction spending. This significant decline in Federal spending follows two large gains of 13.4% and 12.3% in January and December, respectively.
