Construction spending in U.S. shows a decline
WASHINGTON — U.S. construction fell in April by the largest amount in a year, reflecting weakness in homebuilding, non-residential construction and government projects.
The Commerce Department reported construction spending fell 1.4 percent in April, the biggest drop since a 2.9 percent fall in April of last year. The decline left spending at a seasonally adjusted annual rate of $1.22 trillion.
Construction activity has been one of the bright spots for the economy over the past year, and the big decline in April is expected to be temporary. Analysts are forecasting construction will provide continued fuel for the economy in the coming year.
The April result followed a revised 1.1 percent increase in March, which had pushed construction spending to a record high of $1.24 trillion.
Residential construction slipped 0.7 percent, the biggest drop since a 1.1 percent decline in September 2016. The Commerce Department reported new home construction was down 2.6 percent in April, but analysts blamed much of that weakness on temporary factors.
Non-residential construction dropped 0.6 percent in April, the third straight monthly decline.
While spending on office construction was up for the month, spending on hotels and motels and the category that includes shopping centers fell. Spending on construction of factories was also down a sharp 1.9 percent and down 8.4 percent from a year ago.
Government construction activity was also down 3.7 percent. State and local construction, the biggest part of the government spending category, fell 3.5 percent, while spending on federal projects was down 5.7 percent.