US construction spending inched up in December, pushing 2015 activity to highest level since in 8 years
WASHINGTON (AP) — U.S. construction spending rebounded slightly in December, helping push total spending for 2015 to the highest level in eight years.
Construction spending increased 0.1 percent in December after falling in October and November, the Commerce Department said Monday.
The December increase was driven by gains in home construction and spending on government projects. That offset declines in spending on private construction of shopping centers, office buildings and hotels.
For all of 2015, construction jumped 10.5 percent to $1.1 trillion, the highest total since 2007.
A home construction boom peaked in 2006 before falling for the next five years. Construction spending has been climbing since 2012. Economists believe building activity, fueled by home construction, will bolster the overall economy this year.
Home construction was a bright spot in the fourth quarter, growing at an annual rate of 8.1 percent in the October-December period. That was one of the best showings for any major category.
The overall economy, as measured by the gross domestic product, grew at a meager annual rate of 0.7 percent in the fourth quarter. Economists are looking for stronger growth of around 2.5 percent in the current January-March period.
For December, home construction advanced 0.9 percent, while non-residential construction fell 2.1 percent. Spending on state and local government projects was up 2.3 percent, but spending on federal building projects fell 3.3 percent.
For all of 2015, home construction rose 12.6 percent, while private non-residential activity was up 12 percent. This sector was strong for most of the year, but it has declined in three of the past four months. Spending on state and local building projects rose 6.1 percent in 2015, while spending on federal projects was up a smaller 0.7 percent.
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