Public Spending Buoys October Construction Numbers

Construction spending was lower on a month-over-month basis in October, but an increase in public sector spending held the overall decline to a minimum.  The U.S. Census Bureau said that total expenditures on spending nationwide was at a seasonally adjusted annual rate of $1.309 trillion, down 0.1 percent from the revised (from $1.330 trillion) September rate of 1.311 trillion.  Overall spending has been relatively flat for some months, but spending is up year-over-year by 4.9 percent.

On a non-adjusted basis total spending was $117.333 billion during the month compared to $117.898 in September.  For the year-to-date (YTD) through October total spending of $1.044 trillion is 5.1 percent higher than through the first 10 months in 2017.

Private sector spending was at $998.692 on a seasonally adjusted basis, down 0.4 percent from $1.003 trillion in September and up 3.9 percent compared to October 2017.  On a non-adjusted basis spending was $88.295 billion for the month and $839.936 billion for the YTD.  The latter is up 4.4 percent from the same period in 2017.

Private sector residential construction was down 0.5 percent from September at a rate of $538.958 billion and single-family construction was down a half-point as well, to $282.611 billion.   Both remain higher than in October 2017, total residential spending by 1.8 percent and single-family by 2.4 percent.  October spending on buildings with five or more units was at a rate of $62.035 billion, up 1.0 percent for the month and 3.2 percent year-over-year.

Of the 11 categories of non-residential spending, seven declined during the month.  The only two categories that gained more than a fraction of a point were office, up 1.6 percent, and commercial which gained 3.1 percent.  All but three categories however were higher than during the previous October.

On a non-adjusted basis, overall residential expenditures totaled $48.079 billion for the month and $461.993 for the YTD, an increase of 5.0 percent from the same period in 2017.  Single-family construction spending through October was $240.012 billion, a 6.8 percent increase, while multi-family, at $50.026 billion, is down 0.2 percent thus far in 2018.

Public sector spending rose by 0.8 percent from September and 8.5 percent from a year earlier to a seasonally adjusted annual rate of $310.156 Billion. Residential spending was up 2.0 percent for the month at a rate of $6.108 billion but that is 4.8 percent lower than in October 2017.  Spending YTD in the public sector is up 7.3 percent to $256.439 but residential spending has declined by 2.8 percent.