December 2020 Construction Spending

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Construction spending during December 2020 was estimated at a seasonally adjusted annual rate (SAAR) of $1,490.4 billion, 1.0% (± 0.8%) above the revised November estimate of $1,475.6 billion (originally $1,459.4 billion); consensus expectations were for +0.8%. The December figure is 5.7% (±1.0%) above the December 2019 SAAR of $1,410.3 billion; the not-seasonally adjusted YoY change (shown in the table below) was +6.0%.

The value of construction in 2020 was $1,429.7 billion, 4.7% (±1.0%) above the $1,365.1 billion spent in 2019.

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Private Construction

Spending on private construction was at a SAAR of $1,137.6 billion, 1.2% (±0.7%) above the revised November estimate of $1,124.4 billion (originally $1,111.8 billion):
* Residential. $691.0 billion, +3.1% (±1.3%) of which
* Home improvement. $234.6 billion, +0.4 % (+21.3% YoY);
* Nonresidential. $446.6 billion, -1.7% (±0.7%).

The value of private construction in 2020 was $1,079.3 billion, 4.7% (±0.8%) above the $1,030.7 billion spent in 2019:
* Residential. $607.6 billion, 11.6% (±2.1%) above the 2019 figure of $544.4 billion and
* Nonresidential. $471.7 billion, 3.0% (±0.8%) below the $486.3 billion in 2019.

Public Construction

Public construction spending was $352.8 billion, 0.5% (±1.3%)* above the revised November estimate of $351.1 billion (originally $347.6 billion):
* Educational. $90.2 billion, +0.6% (±1.5%)*;
* Highway. $98.4 billion, +0.9% (±3.5%)*.

The value of public construction in 2020 was $350.5 billion, 4.8% (±1.6%) above the $334.4 billion spent in 2019:
* Educational. $87.3 billion, 3.6% (±3.3%) above the 2019 figure of $84.3 billion and
* Highway. $98.8 billion, 1.8% (±4.1%)* above the $97.1 billion in 2019.

* 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 December’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.