U.S. construction spending flat in August
U.S. construction spending was unexpectedly flat in August as an increase in public sector projects was offset by weakness in the private sector.
The Commerce Department said on Friday that the unchanged reading in construction spending followed a 0.3% gain in July. Construction spending increased 8.9% on a year-on-year basis in August. Economists polled by Reuters had forecast construction spending gaining 0.3%.
Spending on private construction projects slipped 0.1% after rising 0.2% in July. Outlays on residential construction advanced 0.4%, likely lifted by remodeling projects, after rising by the same margin in July.
Single-family homebuilding spending fell 0.7% and outlays on multi-family housing projects dropped 0.8%. Homebuilding is being hampered by expensive building materials as well as land and labor shortages.
Investment in private non-residential construction like gas and oil well drilling declined 1.0% in August.
Spending on public construction projects rose 0.5% in August, matching July’s gain. Outlays on state and local government construction projects increased 0.8%, but federal government spending dropped 4.6%.