The Commerce Department said on Thursday that the unchanged reading for construction spending followed a 0.9 percent rise in June that had previously been reported as a 0.6 percent decline. Total home construction was up 1.9 per cent from a year ago.
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US construction spending was unexpectedly flat in July as gains in the private sector were offset by steep declines in government outlays, but upward revisions to the prior two months suggested a lift to the second-quarter economic growth estimate.
Public construction fell 3.1% to a rate of $278.2 billion, in large part due to a decline in educational construction.
Looking at the first seven months of 2016, the overall data should offer some encouragement over capital spending levels.
Residential spending remains up 1.7 percent over the July 2015 rate. Residential construction was at a seasonally adjusted annual rate of $445.5 billion in July, 0.3 percent above the revised June estimate of $444 billion. Year-over-year, total residential construction spending in July (including both private and public) marked a modest 1.5% increase compared to a year prior. Spending on single-family home construction was down 0.2 percent while spending on apartment construction dropped 0.6 percent.
Non-residential construction has been up sharply in four of the past five months with July activity 7.1 per cent higher than a year ago. In addition to solid gains in office and shopping center work, there were also strong increases in manufacturing and power plant construction. Economists had expected spending to climb by 0.6 percent. Federal government construction spending declined 3.3 per cent.
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The overall economy grew at a modest 1.1 percent annual rate in the spring after an even weaker 0.8 percent gain in the first quarter.
