Construction spending was up 1.3% in January, well above the 0.3% gain expected by MNI, as public construction posted its largest gain since September 2010. Private residential declined 0.3%, while nonresidential rose by 0.8%, data released by the Commerce Department Wednesday morning showed.
Analysts surveyed by MNI had expected total construction spending to rise by 0.3% after a 0.8% decrease in December, while the Bloomberg consensus expected a 0.4% gain. November was revised sharply down to a 1.3% decline from a 0.8% gain previously reported.
Here are the key takeaways from the release:
Private residential construction fell by -0.3% in the month, following a 1.9% drop in December. Home building ex. new homes, also known as remodeling, saw a 0.3% decrease, according to an MNI calculation. Also based on an MNI calculation, total new homes fell by 0.3%. Single-family building fell by 0.7%, while multi-family building posted a 1.4% increase.
In addition to the decrease in private residential, private nonresidential construction rose by 0.8% in January, driving the increase in total private construction. The main drivers of the category were increases in transportation (+6.8%), commercial (+1.5%), and education (+3.3%).
Following a downward December revision to a 1.0% decrease from a 0.6% decline, public construction spending rose by 4.9% in January, the highest since September 2010. The rise in public construction was driven by a 11.8% rise in highway and street, a 4.0% gain in residential, and a 12.1% increase in commercial. This was partially offset by small declines in some other categories. State and local construction was up 4.9% in the month, its largest increase since July 2009. Federal construction was up 4.2%.
