The construction industry continues to struggle, as overall construction spending for the quarter is 14 percent below the numbers for the same period last year. Construction spending for the first quarter 2010 came in at $179.9 billion. For the first quarter 2009, the total was $209.2 billion.
But because the Census Bureau revised February’s numbers down substantially, the slight increase of 0.2 percent for March was interpreted as a positive by some economists. Still, it’s too early to call the data good news until we see several months of gains.
The estimated seasonally adjusted annual rate came in at $847.3 billion, the Census Bureau reported. During the height of the building boom in 2006, the annualized rate came in at $1217.36 billion.
At that time, residential construction comprised over 6 percent of GDP. That percentage has tumbled to less than 3 percent. Residential construction and nonresidential construction directly feed into GDP calculations, so the news weakens the GDP outlook as well.
Spending for public construction was the one bright spot, most likely due to “shovel ready” projects subsidized by cash handouts from the government.
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