294 OUT OF 337 METRO AREAS LOSE CONSTRUCTION JOBS FROM MAY 2009 TO 2010, REFLECTING WEAK DEMAND & OVERDUE INFRASTRUCTURE BILLS

Most Jobs Added in Columbus, Ohio While Eau Claire, Wisconsin Has Highest Rate of Job Growth; Chico, California Has Highest Rate of Decline and Chicago Loses Most Jobs 

Construction employment continued to suffer significant declines in the majority of metropolitan areas according to an analysis of federal employment data released by the Associated General Contractors of America.  The figures reflect continued weak private, state and local demand as well as a lack of long-term projects caused by stalled federal infrastructure bills, association officials noted.

(more…)

New construction starts in May climbed 3% from the previous month, McGraw-Hill Construction (MHC) reported on Tuesday, based on data it collected. "Nonresidential building showed improvement after weak activity in April, and residential building edged upward. However, nonbuilding construction retreated in May, following April's elevated amount of new public works and electric utility projects. For the first five months of 2010, total construction starts on an unadjusted basis [was] down 2% from the same period a year ago….'The recent pattern of construction starts indicates that activity has stabilized at a low level, with ups-and-downs on a monthly basis, but the transition to sustained expansion has yet to occur,' stated Robert A. Murray, vice president of economic affairs for [MHC]. 'The volume of nonresidential building remains quite low, and is likely to stay that way through 2010. Much of this year's upward movement is expected to come from public works construction, which lost momentum in May after earlier gains.'…The 2% decline for total construction starts on an unadjusted basis during the first five months of 2010 was the result of varied behavior by sector. Residential building climbed 30%, with the comparison to the early months of 2009 when the improvement for single-family housing was just beginning to take hold. Nonbuilding construction year-to-date decreased 8%, with public works down 4% while electric utilities fell 28%. Nonresidential building year-to-date dropped 16%, due to this performance by major segment: commercial building, down 32%; manufacturing building, down 63%; and institutional building, down 4%."

(more…)

CONSTRUCTION EMPLOYMENT DECLINES IN 25 STATES BETWEEN APRIL AND MAY AS STIMULUS OUTWEIGHED BY WEAK PRIVATE, STATE & LOCAL DEMAND

Louisiana Adds Most Jobs During Past Month, Hawaii Adds Highest Percentage; While Most Construction Jobs Are Lost in New York and Wyoming Experiences Highest Monthly Percentage Decrease

Construction employment declined in 25 states between April and May and in 45 states between May 2009 and 2010, according to a new analysis of federal data released today by the Associated General Contractors of America.  Construction employment will remain weak despite the short-term stimulus while private, state and local demand for construction remains depressed, association officials noted.

(more…)

The producer price index (PPI) for finished goods rose 0.3% in May, not seasonally adjusted (but fell 0.3%, seasonally adjusted) and 5.3% over 12 months, the Bureau of Labor Statistics (BLS) reported on Wednesday. The PPI for inputs to construction, a weighted average of all materials used by every type of construction plus items consumed by contractors, such as diesel fuel, increased 0.7% and 5.9%. Despite the higher input costs, contractors continued to bid work at lower prices than a year ago. PPIs for four completed building types were little changed for month but lower than a year earlier: new schools, -0.2% for the month and -1.6% year-over-year; industrial buildings, 0.3% and -3.7%; offices, 0.1% and -3.9%; and warehouses, 0 and -4.6%. The PPIs for subcontractors' prices for nonresidential new and repair work showed a similar squeeze: plumbing contractors, 0.3% in May and 1.3% year-over-year; concrete, 0 and -1.5%; electrical, 0 and -1.8%; and roofing, 0.1% and 2.0%. PPIs for materials showed a wide range of changes. There were increases in May for steel mill products, 3.5% for the month and 32% year-over-year; lumber and plywood, 3.2% and 24%; and gypsum products, 3.1% and -2.7%. there were decreases in May, after months of large increases, for copper and brass mill shapes, -6.8% and 20%; diesel fuel, -1.8% and 42%; and aluminum mill shapes, -0.4% and 16%.

(more…)

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.

"Economic activity continued to improve since the last report across all 12 Federal Reserve Districts, although many Districts described the pace of growth as ‘modest,'" the Fed reported Wednesday in the latest Beige Book, a summary of informal soundings of business conditions conducted from mid-April to May 28. The districts are referred to by their headquarters cities. "Higher residential construction increased demand for construction equipment and materials in the Philadelphia, Richmond, Chicago, Dallas, and San Francisco Districts. Residential real estate activity improved since the last report. Most Districts noted an increase in home sales and construction prior to the April 30th deadline for the homebuyer tax credit, with contacts in many of these Districts also indicating a corresponding slowing in activity in May. Tight credit, the elevated inventory of homes available for sale, and the "shadow inventory" of foreclosed properties on banks' balance sheets held back residential development in the New York, Cleveland, Atlanta, and Chicago Districts. Commercial real estate activity generally remained weak. Office, industrial, and retail vacancy rates continued to drift upward in many Districts putting downward pressure on rents. However, lower rents were said to have led to an increase in leasing activity in New York, Philadelphia, Richmond, Kansas City, Dallas, and San Francisco. The elevated inventory of existing properties for sale or rent continued to weigh on new private nonresidential construction. However, stronger industrial demand was noted in several Districts. Public construction increased in Philadelphia, Cleveland, and Chicago, but slowed in Minneapolis….real estate lending increased even though standards on these loans remained tighter than on other loans, particularly for commercial mortgages. Chicago noted that the secondary market for residential mortgages was beginning to improve, and private equity investment in commercial properties increased in Boston, Chicago, and Dallas….Steel prices in many Districts moved higher, as did lumber…but diesel fuel cost pressures eased in New York."

(more…)

Construction employment shrank by 35,000 jobs in May, seasonally adjusted, virtually wiping out the 41,000-job gain recorded in the previous two months (27,000 in March and 14,000 in April), the Bureau of Labor Statistics (BLS) reported on June 4. Despite appearances, it is too early to conclude that the industry is on a renewed downtrend after finally adding jobs.

(more…)

CONSTRUCTION EMPLOYMENT DROPS AGAIN AS 35,000 WORKERS LOSE JOBS IN MAY, WHILE SECTOR'S UNEMPLOYMENT RATE STAYS ABOVE 20 PERCENT

Stimulus Gains Largely Offset By Depressed Private, State and Local Construction Demand 

Construction employment declined in May as 35,000 workers lost jobs, offsetting most of the increases the industry experienced in March and April, according to a new analysis of federal employment figures by the Associated General Contractors of America.  The figures show how fragile the sector is despite recent increases in stimulus funding activity, association officials noted.

(more…)

Construction spending increased 2.7% in April, the largest one-month percentage gain in a decade, to $869 billion at a seasonally adjusted annual rate, the Census Bureau reported on Tuesday. Nevertheless, the total was 10.5% lower than a year earlier. Public construction climbed 2.4% for the month but fell 4.4% year-over-year. Private nonresidential construction was up 1.7% in April but was 25% lower than in April 2009. Private residential spending rose 4.4% and 4.1%. Federal stimulus spending apparently drove significant increases in a range of public construction categories. For example, compared to March, spending on public drinking water supply facilities jumped 7.9%; public sewage treatment, 3.9%; and highway construction 3.6%. Spending on other public transportation modes was flat for the month but soared 29% compared to April 2009. In contrast, public educational construction spending, which received little stimulus support, only edged up 0.4% for the month and was 18% lower than a year earlier. Private nonresidential spending was boosted by strong gains in private power construction, 5.2%; manufacturing, 2.7%; and communication, 7.3%. Meanwhile, developer-financed categories, plagued by high vacancy rates and tight credit conditions, continued to tumble. Private lodging construction rose 0.8% for the month but was down 61% compared to April 2009; commercial (retail, warehouse and farm) was down 2.9% in April and 37% year-over-year; and private office was down 1.7% for the month and 36% year-over-year. Private residential construction figures were also mixed. New single-family construction climbed 3.4% for the month and 29% year-over-year, and improvements to existing single- and multi-unit construction rose 6.3% and 2.7% from a year earlier. But new multi-family construction-condos and rental buildings, which are developer-financed -slumped 1.9% in April and 57% from a year ago.

(more…)

STRONG CONSTRUCTION SPENDING REBOUND IN APRIL AS STIMULUS FUNDING & RESIDENTIAL CONSTRUCTION DRIVE DEMAND

 2.7 Percent Increase in Spending Represents Largest Monthly Increase in 10 Years

Construction spending rebounded strongly in April, with an increase of 2.7 percent or $23 billion from March to a seasonally adjusted annual rate of $869 billion according to the latest analysis of federal spending figures released today by the Associated General Contractors of America.  The association noted that the gains were primarily driven by private residential construction (up 4.4 percent) and public construction (up 2.4 percent), but that private nonresidential also increased significantly (up 1.7 percent).

(more…)