About Amerisurv| Contact    
Magazine | Newsletter    
Flickr Photos | Advertise    
HomeNewsNewsletterAmerisurv DirectoryJobsStoreAuthorsHistoryArchivesBlogVideosEvents
Register to receive the Amerisurv Newsletter | Also See Our LiDAR News Newsletter | RSS Feed  
advertisement


Subscriptions
Sponsored By

Software Reviews
Continuing Series
     RTN
An RTN expert provides everything you need to know about network-corrected real-time GNSS observations.
Click Here to begin the series,
or view the Article PDF's Here
76-PageFlip Compilation
of the entire series
Test Yourself

Got Answers?
Test your knowledge with NCEES-level questions.
  Start HERE
Meet the Authors
Check out our fine lineup of writers. Each an expert in his or her field.
Wow Factor
Sponsored By


Product Reviews
Partner Sites

machinecontrolonline 


lbszone.com

GISuser.com

GeoJobs.biz

GeoLearn

 

Spatial Media LLC properties

Associates

ASPRS

newsnow 

  The American Surveyor     

Nonresidential Construction Spending Remains Elevated in May, But Private Sector Falters, Says ABC Print E-mail
Written by Associated Builders and Contractors   
Tuesday, 03 July 2018

Washington, July 2—Nonresidential construction spending inched 0.1 percent higher on a monthly basis in May, according to an Associated Builders and Contractors analysis of U.S. Census Bureau data released today. Spending, which totaled $749 billion on a seasonally adjusted annual rate for the month, is up 3 percent from the same time last year.

Public nonresidential spending increased 0.6 percent for the month and 4.9 percent for the year, while the private sector contracted 0.3 percent for the month but increased 1.8 percent year-over-year. The dip in private sector is spending is largely attributable to a 2.3 percent decrease in manufacturing-related spending.

“The prediction has been that publicly financed construction spending would rise in America,” said ABC’s Chief Economist Anirban Basu. “The logic of this is rooted in two basic factors. The first is that the ongoing economic expansion, now in its 10th year, has steadily improved fiscal conditions in state and local government. With more money to spend, more communities are empowered to deal with deferred maintenance and even to expand the capacity of certain key infrastructure, whether roads, mass transit, wastewater treatment plants or water systems.

“The other factor relates to a political cycle,” said Basu. “Increasingly, policymakers have been making the case—and much of the electorate seems convinced—that stepped-up infrastructure investment is needed. Accordingly, in recent years, 31 states have expanded their transportation funding, including 24 of them by raising state gas taxes. Not surprisingly, public construction spending is higher on month-over-month and year-over-year bases.

“What has been less clear is whether privately financed construction would continue to rise,” said Basu. “While the economy remains strong, a number of headwinds have formed, particularly concerns regarding tariffs and trade wars. Construction material prices have already begun to surge, in part because of trade disputes involving materials such as softwood lumber, steel and aluminum. This increases project costs without offering developers and their financiers any offsetting commercial benefit.

“Moreover, fears of a full-blown trade war between the United States and NAFTA partners, the European Union and/or China have likely resulted in some businesses and investors adopting a wait-and-see attitude,” said Basu. “This helps explain the recent dip in construction spending related to manufacturing. With key interest rates, like the prime rate, also on the rise, the motivation to move forward with projects may be waning. Rising borrowing costs make it less likely that a project will satisfy a given investor’s hurdle rate. Rising labor costs contribute further to this calculus.

“The upshot is that contractors would likely be primary beneficiaries of a less precarious policymaking environment,” said Basu. “Businesses, markets, developers and financiers each prefer certainty. They also prefer input costs that aren’t surging. This strongly suggests that, while private construction spending should remain sturdy during the months ahead given healthy backlog and current economic momentum, the outlook for construction spending may be rather different in a few quarters.”

Visit ABC Construction Economics for the Construction Backlog Indicator, Construction Confidence Index and state unemployment reports, plus analysis of spending, employment, GDP and the Producer Price Index.

About ABC
Associated Builders and Contractors (ABC) is a national construction industry trade association established in 1950 that represents more than 21,000 members. Founded on the merit shop philosophy, ABC and its 70 chapters help members develop people, win work and deliver that work safely, ethically and profitably for the betterment of the communities in which ABC and its members work. Visit us at abc.org.

 
< Prev   Next >

deliciousrssnewsletterlinkedinfacebooktwitter

Amerisurv Exclusive Online-only Article ticker
Featured Amerisurv Events
List Your Event Here
please
contact Amerisurv


Google
 
AMERISURV TOP NEWS

Javad Intros
Total Solution

GOT NEWS? Send To
press [at] amerisurv.com
Online Internet Content

Sponsor


News Feeds

 
Subscribe to Amerisurv news & updates via RSS or get our Feedburn
xml feed

Need Help? See this RSS Tutorial

Historic Maps
Careers

post a job
Reach our audience of Professional land surveyors and Geo-Technology professionals with your GeoJobs career ad. Feel free to contact us if you need additional information.

 

Social Bookmarks

Amerisurv on Facebook 

Amerisurv LinkedIn Group 

Amerisurv Flickr Photos 

Amerisurv videos on YouTube 

twitter

 




The American Surveyor © All rights reserved / Privacy Statement
Spatial Media LLC
7820B Wormans Mill Road, #236
Frederick MD 21701
301-620-0784
301-695-1538 - fax