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U.S. Construction Spending Rises More Than Expected In March

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Construction spending in the U.S. rebounded more quickly than expected in March following a contraction in February that was worse than initially reported.

According to figures released by the Census Department on Monday, construction spending in March came in at a seasonally adjusted annual rate of $768.9 billion, a 1.4 percent increase from the revised figures for February.

However, according to the revised figures for February, the contraction in construction spending was worse than initially reported, with spending falling by 2.4 percent compared to the 1.4 percent drop initially reported.

The March increase in construction spending was well above the 0.5 percent increase most economists had predicted. The growth was even stronger than the 1 percent increase predicted by some of the more optimistic economists.

However, March construction spending levels are still 6.7 percent below the figures posted in March 2010.

The March increase in construction spending reverses three consecutive months of decreasing spending.

Private construction spending drove much of the overall increase, rising 2.2 percent after also having fallen for the three previous months.

Residential and non-residential private construction spending both increased, with residential construction up 2.6 percent and non-residential up 1.8 percent.

Public construction spending rose by a more modest 0.1 percent, with a 0.3 percent increase in state and local government construction spending offsetting a 2 percent drop in federal construction spending.

Of the public construction spending, educational spending was up 0.5 percent and highway construction increased 0.6 percent.

The March increases in overall public construction spending and by state and local governments reverses a trend of at least five months of contractions, according to the Commerce Department.

by RTTNews Staff Writer

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