New statistics covering non-residential construction spending show signs of continuing recovery in the construction industry. This area of construction spending increased 1 percent in October 2014, resulting in a 4.3 percent increase for the year to date, according to a December 2, 2014 report by the U.S. Department of Commerce.
The Commerce Department report further noted that October spending on non-residential construction was nearly $612 billion. Revisions to numbers for September showed that construction in that month totaled nearly $605 billion, up from the previously reported total of just over $596 billion.
The reported increases in non-residential construction confirm industry insider reports of increased business and mounting backlogs, noted Anirban Basu, chief economist for the industry organization Associated Builders and Contractors.
The Census Bureau report indicated expansion in 11 of 16 important non-residential construction categories in October. Some of these sub sectors include:
- Highway and street construction, which was up 1.2 percent in October.
- Public safety construction, which increased 11.6 percent over September.
- Office construction, which increased 2 percent in October, reflecting a 16.3 percent increase over the same period in 2013.
- Manufacturing construction, which increased 3.4 percent over September, representing a 22.2 percent annual increase.
- Education-related construction, which was up 1.8 percent for October and 3.6 annually.
- Health care construction, which increased 0.6 percent in October. The report indicated that even with this modest increase, health care construction spending was down 8.4 percent from the same period in 2013.
- Lodging construction, which rose 3.3 percent from September to October, representing a nearly 16 percent increase over the year.
Basu also reported confidence that the non-residential construction expansion would continue to increase into 2015. This prediction is based on existing signs of industry recovery along with overall improvements in the American economy and boosts from low interest rates.
Construction industry professionals rely on the inside information on building permits, housing starts and industry trends provided by Construction Monitor. Contact us today for more information on increases in non-residential construction and what it means for the construction industry as a whole.
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