The Census Bureau said that private manufacturing construction spending rose by 1.3 percent in October, ending four straight months of declines from June through September.
The value of construction put in place in the sector increased from $60.44 billion in September to $61.20 billion in October, its best reading since July. The September reading was its lowest since September 2014, with that figure negatively impacted by recent hurricanes, among other challenges. Construction spending in the sector has averaged $66.30 billion year-to-date in 2017, down from the average of $74.61 billion in 2016 as a whole.
While manufacturing construction has largely trended higher over the past few years, activity has trended lower since achieving the all-time high of $82.13 billion in May 2015. Nonetheless, we would continue to expect a turnaround in construction activity in the coming months, especially in light of the improved outlook of late.
Overall, private nonresidential construction spending increased by 0.9 percent in October, rising to a 3-month high, but activity was off by 1.3 percent over the past 12 months. In October, the data were mixed. There were increased dollars spent on construction projects in the transportation (up 7.2 percent), office (up 4.4 percent), educational (up 2.5 percent), lodging (up 2.3 percent) and health care (up 1.2 percent), in addition to the manufacturing data discussed above. In contrast, those gains were partially offset by reduction construction spending for religious (down 3.7 percent), amusement and recreation (down 2.0 percent), commercial (down 1.9 percent), power (down 0.3 percent) and communication (down 0.1 percent) projects.
Meanwhile, private residential construction spending was up 0.4 percent in October, with a healthy 7.4 percent year-over-year gain. For the month, single-family construction was up by 0.3 percent, with the multifamily segment down 1.6 percent. Since October 2016, single-family construction spending rose 8.9 percent, but multifamily activity was off by 2.0 percent year-over-year. In addition to those components, public construction spending was up 3.9 percent in October, with a gain of 1.8 percent over the past 12 months.
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