May 2017 Construction Spending

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Following revisions back to January 2015, construction spending during May 2017 was estimated at a seasonally adjusted annual rate (SAAR) of $1,230.1 billion, nearly the same as (±2.5 percent)* the revised April estimate of $1,230.4 billion (originally $1,218.5 billion); consensus expectations were for a 0.5% increase. The May figure is 4.5 percent (±2.5 percent) above the May 2016 SAAR of $1,177.0 billion; the not-seasonally adjusted YoY change (shown in the above table) was +4.9%. During the first five months of this year, construction spending amounted to $469.2 billion, 6.1 percent (±1.3 percent) above the $442.4 billion for the same period in 2016.

Private Construction

Spending on private construction was at a SAAR of $943.2 billion, 0.6 percent (± 0.7 percent)* below the revised April estimate of $949.3 billion.
- Residential: $509.6 billion, -0.6 percent (±1.3 percent)*.
- Nonresidential: $433.6 billion, -0.7 percent (± 0.7 percent)*.

Public Construction

Public construction spending was $286.9 billion, 2.1 percent (±5.3 percent)* above the revised April estimate of $281.0 billion.
- Educational: $74.3 billion, +5.1 percent (±3.3 percent).
- Highway: $90.6 billion, -0.9 percent (±16.9 percent)*.

* 90% confidence interval includes zero. The U.S. Census Bureau does not have sufficient statistical evidence to conclude that the actual change is different from zero. 

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Click here for a discussion of May’s new residential permits, starts and completions. Click here for a discussion of new and existing home sales, inventories and prices.

The foregoing comments represent the general economic views and analysis of Delphi Advisors, and are provided solely for the purpose of information, instruction and discourse. They do not constitute a solicitation or recommendation regarding any investment.