Government Says Construction Spending Flat in May

(CN) – Construction, projected to be a key pillar of economic growth for the rest of the year, was flat in May, as flagging new home building continues to drag down the sector.

The Commerce Department said Monday construction of new private residential construction fell 0.6 percent in May, the first decline in that category since April 2016 and its biggest decline since a 0.6 percent drop in July 2014.

Non-residential construction declined 0.7 percent, the fifth straight monthly decline for the category.

Overall construction spending was reported at a seasonally adjusted annual rate of $1.23 trillion, the same as last month’s revised figure.

The flat May number follows April’s decline of 0.7 percent, which was revised from an originally reported drop of 1.7 percent.

Government construction spending rose at the state and federal levels after declines last month. State and local government construction rose 1.7 percent after last month’s decline of 2.7 percent.

Federal government construction also rebounded, rising 6.4 percent after a decline of 2.1 percent in April.

Construction of manufacturing facilities dipped 1.7 percent in May and is down 10.7 percent from the same month last year.

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