Construction Spending Rose In March

Construction spending rose slightly in March, reversing five straight months of declines, according to figures released Monday by the Commerce Department.

Total seasonally adjusted construction spending in March was an estimated $969.7 billion, up 0.3 percent from February's revised figure of $967.1 billion. The March figures represent a decline of 11.1 percent from the March 2008 total of $1.090.5 billion.

Last month's increase was driven by a rise in spending on public projects in general and educational and power projects in particular. The two sectors accounted for more than three-quarters of the $3.3 billion increase in public construction spending in March. Total public construction spending totaled a seasonally adjusted $308.7 billion for the month, up from $305.4 in February.

Private construction continues decline

Private construction spending declined slightly, falling to $661.0 billion in March, the sixth straight month of private construction declines. The March figure represented a 0.1 percent decline from February's figures of $661.6 billion.

Spending on public educational construction projects rose $1.4 billion in March, to $89.2 billion total. Construction spending on power projects rose even more sharply, increasing almost 11 percent in March to reach to $11.8 billion, a $1.15 billion increase.

Private construction remains 16.3 percent below the March 2008 level of $789.6 billion. Overall, the sharpest yearly construction declines were posted in residential (down 34.0 percent), communications (down 33.0 percent), and commercial (down 21.8 percent).

Manufacturing, power construction increase

However, private manufacturing and power construction showed healthy gains over March 2008, Manufacturing construction was up a whopping 64.4 percent over the previous year, to $83.9 billion from $51.0 the year before. Private power construction posted a one-year gain of 18.2 percent, up to $64.8 billion in March compared to $54.8 billion one year before. Both posted increases over the Feburary 2009 figures as well.

Manufacturing construction has been increasing fairly steadily over the past 12 months, but it remains to be seen if the increases portend an improvement in the economy or represent long-planned projects that were put in place before last fall's economic meltdown.