After seeing its largest one-month gain in over two years, US construction spending dropped 0.8 percent in August. Construction spending fell in August to a seasonally adjusted annual rate of $961.0 billion. The estimate for July has been revised to $968.8 billion, down from the initial estimate last month of $981.3 billion.
According to the US Census Bureau, total construction spending from January through August was $623.1 billion which is 6.8 percent higher than the $583.2 billion spent during the same period last year (January – August 2013).
Private construction spending was at a seasonally adjusted annual rate of $685.0 billion in August. This is a 0.8 percent drop from July’s revised amount of $690.3 billion. July’s initial estimate was at a $701.7 billion seasonally adjusted annual rate. Nonresidential construction accounted for about 49 percent of all private construction spending at a seasonally adjusted annual rate of $333.3 billion.
Public construction spending in August was estimated at $275.9 billion, 0.9 percent lower than the revised July estimate of $278.5 billion. The initial estimate for public construction spending for July was $279.6 billion.
Construction spending has been up and down over the last few months, but it shouldn’t cause too much of a concern. The August 2014 annual rate of $961.0 billion is 5.0 percent higher than the August 2013 estimate of $915.3 billion. If construction spending continues at its current rate of $961.0 billion through the rest of the year, construction spending in 2014 will be about 5.5 percent higher than the amount spent last year.