Construction Spending Increases Again
The U.S. Census Bureau reported construction spending increased in August to a seasonally adjusted annual rate of $1,983.5 billion, 0.5 percent above the bureau’s revised July estimate.
The August figure is 7.4 percent above the August 2022 estimate of $1,847.3 billion, the bureau said.
Construction spending amounted to $1,284.7 billion during the first eight months of this year, 4.2 percent above the $1,233.4 billion for the same period in 2022.
Wells Fargo Economics, Charlotte, noted construction spending continues to exceed expectations. “Construction activity this year has been largely resilient to broader macroeconomic headwinds,” Wells Fargo Economics said in a report, noting that August solidified an eight-month streak of improvements in 2023 and amount to a 7.4% year-over-year gain. “Yet as construction outlays rise on trend, clear divisions are forming under the surface,” the report said. “An uptick in single-family starts has bolstered construction spending over the last few months, largely owed to builders’ success with incentives in the high mortgage rate environment.”
By contrast, multifamily construction appears to be moderating as a near-record number of apartment units is set to deliver over the next few years, Wells Fargo Economics said.