AGC has compiled tables of PPIs for construction materials and segments as well as analysis. The data is from the Bureau of Labor Statistics monthly report and covers over 50 construction specific data series.

The producer price index (PPI) for finished goods climbed 0.9% in January, not seasonally adjusted (0.8%, seasonally adjusted), but fell 1.0% compared to January 2008, the Bureau of Labor Statistics (BLS) reported on Thursday. The PPI for construction inputs fell 0.3% for the month, not seasonally adjusted, and rose 1.8% from a year earlier. The PPI for highway and street construction inputs rose 0.4% in January and fell 1.4% over 12 months. PPIs for other segments fell for the month but rose from a year before: other heavy construction, -0.4% and 0.1%; nonresidential buildings, -0.3% and 1.2%; multi-unit residential, -0.1% and 2.2%; and single-unit residential, -0.4% and 4.0%. The divergent results reflect differing trends in prices of individual materials. There were substantial increases in January in the prices of ready-mixed concrete, 2.3% for the month and 5.7% over 12 months, and its ingredients-cement, 1.2% and 0.9%, and construction sand/gravel/crushed stone, 1.3% and 6.0%. There were also increases for gypsum products, 1.0% and 8.7%; construction machinery and equipment, 0.4% and 4.9%; and plastic construction products, 0.3% and 3.5%. Prices fell in January for aluminum mill shapes, -7.6% and -12%; asphalt paving mixtures and blocks, -6.2% and 23%; steel mill products, -5.8% and -2.2%; copper and brass mill shapes, -5.4% and 19%; and diesel fuel, -4.3% and -41%.

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President Obama yesterday signed the American Recovery and Reinvestment Act. AGC estimates that the act includes $135-144 billion for construction, most of which must be obligated by September 30, 2010. (Missouri announced it had awarded a bridge project a few minutes after the bill became law.) That total covers the following (in billions):  transportation, $49 ($28 highways; $18 transit/rail; $2 airports); water/environment, $21 ($6 nuclear waste; $7 water/wastewater; $5 Corps of Engineers); buildings, $30-$38 ($7 Department of Defense; $6 General Services Administration; $9 other federal; $8 housing; $0-9 schools/other local); and energy/technology, $30 ($11 "smart grid"; $7 wireless/ broadband; $6 energy grants; $5 weatherization). In addition, numerous tax provisions should add to demand for construction: "qualified" school construction bonds; "Build America" bonds; bonds for "recovery zones," tribal areas, renewable energy, energy conservation; and modified renewable energy, conservation credits. Other tax cuts will help contractors directly: higher limits on the size of total investment and amount of equipment eligible for expensing; a continuation of "bonus" depreciation; an increase in the carryback period for net operating losses from two to five years for small businesses with less than $15 million in gross receipts; and a delay from 2011 to 2012 in the start of 3% withholding on government contracts. AGC has posted detailed information about amounts, distribution formulas and timetables, state-by-state allocations where available, and limitations at www.agc.org/stimulus. AGC encourages contractors and suppliers of construction services, materials and equipment to submit examples of jobs saved or created by stimulus projects, and to report cases where stimulus funds are not being awarded timely or appropriately.

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Will February mark the low point in the economic cycle? Assuming President Obama signs the tax and spending relief package this month, and Treasury goes ahead with further banking and credit measures announced by Secretary Geithner on February 10, the economy will soon begin getting a strong double dose of stimulants.

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House and Senate Democratic leaders announced agreement this evening on the fiscal stimulus legislation and intend to push for passage this weekend. "Although the final legislative language was not immediately available, lawmakers said the bill contained more than $150 billion in public works projects for transportation, energy and technology," the New York Times reported online, out of $507 billion of spending and $282 billion in tax relief, for a total of $789 billion. "Late Wednesday night, negotiators were pushing to add $6.6 billion more to satisfy White House and House Democratic demands for more school construction funds," the Wall Street Journal reported online. The construction total apparently remained at a high level even though the overall total is less than in the House bill ($819 billion) or the Senate version ($838 billion). AGC will post updates on tax and spending provisions affecting construction at www.agc.org/stimulus.

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"Today's report on job losses underscores the urgency of implementing a job-boosting economic stimulus package focused on infrastructure," said Ken Simonson, chief economist for The Associated General Contractors of America. Simonson commented on the January employment data from the Bureau of Labor Statistics.

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Construction spending in December totaled $1.054 trillion at a seasonally adjusted annual rate (SAAR), down 1.4% from the downwardly revised November figure and 3.6% below the December 2007 level, the Census Bureau reported on Monday. For the year, construction spending totaled $1.079 trillion, a record 5.1% decline from the previous year. Private residential construction sank 3.2% for the month, 23% compared to the year-earlier month, and 27% for the full year. Private nonresidential construction fell 0.4% for the month but was 8.9% higher than a year before and 15% higher for the full year. Public construction slid 0.8% for the month but climbed 7.0% from December 2007 and 7.4% for the year. The highest-growth category for the year was manufacturing construction, which soared 51% after a huge increase in refinery work, plus large increments for transportation equipment (auto plants for Honda, Toyota and Volkswagen) and primary metal (principally a multi-billion dollar steel plant in Alabama). Power construction climbed 33%, led by a 50% increase in private electric power (mainly conventional power plants, transmission lines and wind farms). Lodging construction rose 29% but has slipped since peaking last summer. The largest categories in 2008 were educational construction, $104 billion (up 8.3% from 2007); commercial (retail, warehouse and farm), $86 billion (-4%); highway and street, $81 billion (+6%); and office, $73 billion (+12%). Among private residential categories, new single-family totaled $186 billion (-39%); new multi-family, $44 billion (-8%); and improvements, $128 billion (-8%).

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"Today's construction figures underscore the dramatic decline in business activity that is putting hundreds of thousands out of work, endangering the viability of tens of thousands of businesses and dragging on the broader economy. This is a stark reminder of the need for immediate and significant federal investments in vital construction and infrastructure projects. Without those investments, we estimate over a million construction workers will lose their jobs while many of the small businesses that dominate the construction industry will close their doors. With these investments, however, construction companies will be able to save those jobs, expand payrolls and invest in equipment and supplies, while building the foundation for a stronger economy," said Stephen Sandherr, chief executive officer of the Associated General Contractors of America.