Privately funded construction investments post 21.9% decline in October 2009 compared to previous year
The construction industry continues to suffer from significant declines in privately funded construction investments, with new federal figures showing an investment decline of 21.9% between October 2008 and October 2009, according to recent figures from the U.S. Census Bureau. The federal figures show the annualized rate of private construction spending declined from $754 billion in October 2008 to $589 billion in October 2009. On the non-residential side, construction spending for lodging declined 44.8%, 36.9% for offices, and 40% for commercial structures over the past 12 months. Power construction was the only part of the private construction market to see increased investments, with only a slight gain of 0.3%.
On the flip side, publicly funded investments in construction increased over the past year by 3.8%, from $310 billion to $322 billion. Public spending on conservation and development and transportation grew the most, with 23.5% and 14.2% increases, respectively, over last October. However, water supply, sewage/waste disposal, and educational investments declined by 9.4%, 3.6%, and 0.1%, respectively.
“Increased public investments in construction and infrastructure are welcome news, but this industry will continue to suffer while demand for private construction continues to plummet,” says Stephen Sandherr, CEO for the Associated General Contractors of America (AGC), Arlington, Va., which continues to urge Congress and the Administration to support the 30 measures outlined in the association's construction industry recovery plan, “Build Now for the Future.” The plan was designed to revive the private construction market while improving public investments in the nation's aging infrastructure. To view AGC's recovery plan, visit the AGC Web site at http://blueprint.agc.org/.