Private construction drops 0.6% in June

posted at 12:15 pm on August 2, 2010 by Ed Morrissey

The Commerce Department released its review of construction data from June, and while the topline gain of 0.1% month-on-month is distinctly unimpressive, the breakdowns are worse.  The annualized rate trails June 2009 annualized estimate by almost 8%, when construction had taken a dive during the economic collapse.  The spending in the first half of 2010 is 11.2% lower than in the first half of 2009:

The U.S. Census Bureau of the Department of Commerce announced today that construction spending during June 2010 was estimated at a seasonally adjusted annual rate of $836.0 billion, 0.1 percent (±1.6%)* above the revised May estimate of $834.8 billion. The June figure is 7.9 percent (±1.6%) below the June 2009 estimate of $907.7 billion.

During the first 6 months of this year, construction spending amounted to $389.6 billion, 11.2 percent (±1.1%) below the $438.7 billion for the same period in 2009.

The numbers for the private sector show no sign of recovery, either:

Spending on private construction was at a seasonally adjusted annual rate of $527.6 billion, 0.6 percent (±1.3%)* below the revised May estimate of $530.9 billion. Residential construction was at a seasonally adjusted annual rate of $258.3 billion in June, 0.8 percent (±1.3%)* below the revised May estimate of $260.3 billion. Nonresidential construction was at a seasonally adjusted annual rate of $269.3 billion in June, 0.5 percent (±1.3%)* below the revised May estimate of $270.6 billion.

How did we get to the anemic 0.1% annualized growth rate?  Public spending, of course:

In June, the estimated seasonally adjusted annual rate of public construction spending was $308.4 billion, 1.5 percent (±2.2%)* above the revised May estimate of $303.9 billion. Educational construction was at a seasonally adjusted annual rate of $71.0 billion, 3.2 percent (±3.4%)* below the revised May estimate of $73.4 billion. Highway construction was at a seasonally adjusted annual rate of $83.2 billion, 0.1 percent (±6.7%)* above the revised May estimate of $83.2 billion.

The annualized overall construction rate peaked this year in April at $843 billion, still a large drop from June 2009′s rate of $907 billion.  The annualized private construction rate in June 2009 was $586 billion, but in June 2010 dropped 10% to $527 billion.  This also peaked in April at $538 billion, far below last year’s rate as well.

Public construction is also off from last June by 4.1%, but unlike the private sector, has grown throughout 2010.  A great deal of that growth has come in public-sector residential construction (31.4% since last June), and peaked in June.  Most non-residential construction in the public sector dropped in the past year (-5% overall), with a couple of exceptions.  Transportation construction increased 20% from just under $29 billion to $38 billion; sewage and waste disposal increased 9.3% from $23.4 billion to $25.6 billion; and conservation and development jumped 31.6% in a smaller category, going from $5.2 billion to $6.9 billion.

The continued drop in private-sector construction belies any talk of Recovery Summer.  The private sector is shrinking its investment in the future, not increasing it.  The only growth industries are in government pork.

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Al Greene wants to put South Carolina back to work.
Al Greene wants to put America back to work.

Inanemergencydial on August 2, 2010 at 12:17 PM

But…but…BHO told us it’s the Recovery Summer.

I can’t believe he would lie to us!!!

/

GrannyDee on August 2, 2010 at 12:18 PM

Where is this construction. We have none here.

faraway on August 2, 2010 at 12:19 PM

The private sector is shrinking its investment in the future, not increasing it. The only growth industries are in government pork.

*sigh*

cmsinaz on August 2, 2010 at 12:19 PM

Recovery Summer traded in for Hunker Down Fall

ted c on August 2, 2010 at 12:20 PM

OK, I give…where’s the “unexpectedly”?

crushliberalism on August 2, 2010 at 12:21 PM

Construction for union jobs: up 50%

Construction for non-union jobs: eliminated

Let the Congressional hearings begin.

faraway on August 2, 2010 at 12:23 PM

Unexpectedly.

fusionaddict on August 2, 2010 at 12:26 PM

Where is this construction. We have none here.

Considering the massive debt the citizenry racked up and the overbuilding over the last few decades, why is this a bad thing?

Consolidation and contraction is a good thing after the orgy of building and buying over the last 20 years.

rickyricardo on August 2, 2010 at 12:27 PM

Hammering the tradesmen into the ground, good job PBHO.

Bishop on August 2, 2010 at 12:28 PM

Bambi will increase construction spending by directing that a new wing be added to the Smithsonian, dedicated to himself.

PackerBronco on August 2, 2010 at 12:30 PM

Anyone have individual State sites for this? I want to use this on a builder to lower his freaking prices!!!

upinak on August 2, 2010 at 12:30 PM

There never was any recovery, “green shoots” or however the propagandist cheerleaders for Bozo care to portray it. They LIE and the ignorance of many are allowing them to get away with it.

The GDP numbers the government puts out are fraudulent. They are FAKE, just like the CRU research in global warming.

In order to aquire a correct and accurate GDP value, subtract out the government spending.

dogsoldier on August 2, 2010 at 12:30 PM

PackerBronco on August 2, 2010 at 12:30 PM

don’t put it past them, they just might do that…

cmsinaz on August 2, 2010 at 12:30 PM

I went for a Sunday drive yesterday morning and noticed a surprising number of commercial construction projects underway in Phoenix and Tempe.

azkenreid on August 2, 2010 at 12:34 PM

I went for a Sunday drive yesterday morning and noticed a surprising number of commercial construction projects underway in Phoenix and Tempe.

azkenreid on August 2, 2010 at 12:34 PM

Those illegals have to store the drugs somewhere.

Felonious Monk on August 2, 2010 at 12:39 PM

These numbers must be wrong. Somebody is building all those “American Investment and Recovery Act” signs.

Cicero43 on August 2, 2010 at 12:41 PM

Where is this construction. We have none here.

faraway on August 2, 2010 at 12:19 PM

Not seeing anything around here in SE CT except those stupid Putting america Back to Work signs.

Johnnyreb on August 2, 2010 at 12:42 PM

I hear construction (of new gubmint buildings) in booming in the DC area. Construction cranes everywhere.

petefrt on August 2, 2010 at 12:42 PM

Urban sprawl stopped in its tracks. HA!/sarcasm

shick on August 2, 2010 at 12:43 PM

Simple too many houses.

Oil Can on August 2, 2010 at 12:46 PM

Recovery Summer traded in for Hunker Down Fall

Leading to The Winter of Our Discontent

humdinger on August 2, 2010 at 12:49 PM

Not good me thinks!!

canopfor on August 2, 2010 at 12:55 PM

Ok guys….sorry for the OT but what is up with Virginia?

The Virginia AG just ruled that police can check the immigration status on people stopped or arrested. Breaking on Foxnews.com…hmmmmm

milwife88 on August 2, 2010 at 12:55 PM

Home Builders In A Hole

Battered by the bust, they’re filing for Chapter 11 and begging hedge funds for help
——————————–

Ramson isn’t alone in his angst. The downturn in the housing market has caught the nation’s home builders by surprise, leaving many overextended with costly land they can’t develop and unfinished homes they can’t sell. The financial strain is starting to show. From Arizona to Arkansas, dozens of small- and midsize builders have filed for bankruptcy over the past six months. Among the casualties:
==============

http://www.businessweek.com/magazine/content/07_21/b4035053.htm

canopfor on August 2, 2010 at 12:57 PM

Recovery Summer traded in for Hunker Down Fall

Leading to The Winter of Our Discontent

humdinger on August 2, 2010 at 12:49 PM

humdinger:And on to the Spring of Sorrow!!

canopfor on August 2, 2010 at 12:59 PM

The Virginia AG just ruled that police can check the immigration status on people stopped or arrested. Breaking on Foxnews.com…hmmmmm

milwife88 on August 2, 2010 at 12:55 PM

milwife88: The Arizona Effect!:)

canopfor on August 2, 2010 at 1:02 PM

Several members of my family are self-employed in various segments of the construction industry. They have been very hard hit. It’s not just new construction, residential or commercial, it’s expansions, re-tooling and updating too. Businesses are just stagnating and the folks who would normally be contracted to up-grade or what have you are stagnating along with them. One is the reluctance on the part of banks to loan money and another is controlling inventory and production to keep taxes and over head at a minimum. It’s a tangled mess and it was, plainly and simply, brought on by the housing bubble and Congresses unwillingness to control it, Everybody except them it seems, saw it coming but those folks on the hill were too interested in certain voting constituencies and took us all down with them. If there’s any justice they should have a price to pay. Want to bet on that one?

jeanie on August 2, 2010 at 1:06 PM

What happened to all those “shovel ready jobs”?

GarandFan on August 2, 2010 at 1:06 PM

What happened to all those “shovel ready jobs”?

GarandFan on August 2, 2010 at 1:06 PM

My dog creates a “shovel ready job” at least twice a day. This is probably what Obama is counting.

azkenreid on August 2, 2010 at 1:14 PM

But…but…BHO told us it’s the Recovery Summer.

I can’t believe he would lie to us!!!

/

GrannyDee on August 2, 2010 at 12:18 PM

As Endless Bummer 2010 swings its way more towards Down Fall 2010…..

pilamaye on August 2, 2010 at 1:18 PM

What happened to all those “shovel ready jobs”?
GarandFan on August 2, 2010 at 1:06 PM

Digging the graves of all those who have been treated under ObamaCare.

Bishop on August 2, 2010 at 1:18 PM

Recovery Summer traded in for Hunker Down Fall

Leading to The Winter of Our Discontent

humdinger on August 2, 2010 at 12:49 PM

humdinger:And on to the Spring of Sorrow!!

canopfor on August 2, 2010 at 12:59 PM

Followed by the Summer of SHTF for this country!

melachiro on August 2, 2010 at 1:26 PM

Urban sprawl stopped in its tracks. HA!/sarcasm

shick on August 2, 2010 at 12:43 PM

Only temporarily, and what a heck of a way to do it. We still have not gotten rid of the Baby Boomer mentality.

Dark-Star on August 2, 2010 at 1:56 PM