U.S. Put-in-Place Construction Spending Sprightlier in November

After a stretch of several months earlier in the second half of 2017, when many of the Census Bureau’s sub-category put-in-place (PIP) construction spending numbers stalled, some sprightlier results were recorded once again in November.

2018-01-18-US-Put-in-Place-Nov-2017

Given that 11 of last year’s 12 months have now been measured, the 2017 over 2016 year-end percentage-change for total construction will almost certainly be close to +5.0%. All the increase will have originated in the residential sector, +11.0%, with non-residential remaining flat.

It’s important to note, however, (i.e., from accompanying Table 1) that with respect to latest three-month results, non-residential work has been staging a comeback. For latest 3-months over previous 3-months (annualized), ‘total’, residential and non-residential are almost the same, only slightly below +9.0%

‘Speed Up / Slow Down’ Table:

The percentage levels and changes in Table 1 are based on the Census Bureau’s seasonally-adjusted (SA) November 2017 and earlier put-in-place construction statistics. ‘Put-in-place’ as a concept is meant to mirror work-in-process or progress payments as projects proceed.

For each type-of-structure, Table 1 takes the behind-the-scenes put-in-place data and compares the percentage changes of latest-12-months-over-previous-12-months versus latest-three-months-over-previous-three-months (annualized).

If the three-month percent change exceeds the 12-month percent change, then construction activity in that type-of-structure category is speeding up. A check mark is entered in the far-right column. If the opposite is occurring, a check mark is entered in the ‘slowing down’ column.

If a type-of-structure category has a latest 3-month percent-change that is negative, but less negative, than its 12-month percent-change, such a circumstance is also considered to be an instance of ‘speeding up’ and warrants a check mark in the right-hand column. (Or, if it’s turning more negative, then it’s ‘slowing down’ further.)

If the percentage changes for a type-of-structure swing from negative to positive, or vice versa, then it’s obvious where the check mark should go.

Table 1: U.S. Put-in-place Construction Investment − November, 2017
Based on ‘current’ (i.e., not adjusted for inflation) $s, seasonally adjusted at annual rates (SAAR)

Weighting of type-of-structure category
(% of total $s)
    Year to date
2017/
Year to date
2016
(from monthly averages of SAAR data)
    Latest 12 mons vs. previous 12 mons Latest
3 mons vs. previous
3 mons (annualized)
Slowing Down
1 of 3
‘Total’
categories /
7 of 16 sub-categories
Speeding Up
2 of 3 ‘Total’
categories / 
8 of 16 sub- categories
       
       
       
       
       
       
Total Construction 100.0%     4.2%     4.6%   8.8%      
Total Residential 42.8%     10.9%     11.0%   8.9%    
Total Nonresidential 57.2%     -0.2%     0.3%   8.6%      
Lodging 2.3%     6.7%     8.0%   6.2%      
Office 5.6%     4.0%     5.8%   -5.8%      
Commercial (retail) 7.0%     14.3%     15.1%   2.3%    
Health care 3.3%     3.3%     3.2%   17.3%      
Educational 7.9%     3.3%     3.6%   39.6%      
Religious 0.3%     -7.6%     -6.8%   -14.3%      
Public safety 0.7%     2.3%     2.5%   35.3%      
Amusement and recreation 1.8%     4.8%     5.3%   -1.9%      
Transportation 3.7%     2.8%     2.3%   44.7%      
Communication 1.8%     4.4%     4.5%   -6.2%      
Power (electric; oil & gas) 7.7%     -5.6%     -4.2%   -6.5%      
Highway and street 7.0%     -4.0%     -4.3%   13.0%      
Sewage and waste disposal 1.7%     -15.5%     -15.6%   26.7%      
Water supply 0.9%     -9.6%     -8.7%   4.0%      
Conservation and development 0.6%     -7.7%     -5.9%   63.8%      
Manufacturing 4.9%     -12.2%     -11.7%   -11.4%        

In the final two columns, if there is no check mark in the cell, then the type-of-structure category has stayed within 1.0%, up or down.
A negative that becomes more negative is considered to be ‘slowing down’; if less negative, then ‘speeding up’.

Data source: Census Bureau / Table: ConstructConnect

November’s Results:

In the comparison of latest-3-months versus latest-12-months, 7 of the 16 sub-categories of construction ‘slowed’ in November, while eight ‘speeded up’. In other words, there was a mildly positive balance.

‘Lodging’ (moving from +8.0% to +6.2%), ‘office’ (from +5.8% to -5.8%), ‘commercial/retail’ (from +15.1% to +2.3%), ‘amusement and recreation’ (from +5.3% to -1.9%) and ‘power’ (from -4.2% to -6.5%) have all ‘slowed down’.

Providing counterweight, however, have been a half-dozen other major sub-categories: ‘health care’ (moving from +3.2% to +17.3%); ‘educational’ (from +3.6% to +39.6%); ‘public safety’ (from +2.5% to +35.3%); ‘transportation’ (from +2.3% to +44.7%); ‘highway and street’ (from -4.3% to +13.0%); and ‘sewage and waste disposal’ (from -15.6% to +26.7%).  

Especially striking from the above paragraph are the super-charged latest-3-month results for ‘educational’, ‘public safety’ and ‘transportation’.

‘Manufacturing’ has stayed in decline, but at least its degree of retreat has held steady (i.e., barely moving from -11.7% to -11.4%).

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