October construction starts increased 6% from September, but the monthly change was a 3% drop after adjusting for the usual seasonal pickup, according to Jim Haughey, chief economist for Reed Construction Data, Norcross, Ga.
Construction starts are running at an annual rate of $406 billion in the last four months since the steep drop in June, says Haughey. This is marginally below the 2008 total but 25% below the peak starts in this cycle in 2005-2006.
The slower growth expected in the economy for several quarters after the initial 3.5% surge in the summer will spill over into construction, according to Haughey. Monthly reports on starts and job-site spending are more likely to be down than up in the next six months, except for housing where progressive expansion is expected in spending.
For a breakdown in spending by sector, download a PDF from the Reed Construction Web site.
