by Calculated Risk on 11/30/2007 10:14:00 AM

From the Census Bureau: October 2007 Construction Spending at $1,158.3 Billion Annual Rate

Spending on private construction was at a seasonally adjusted annual rate of $863.2 billion, 1.4 percent (±1.1%) below the revised September estimate of $875.2 billion. Residential construction was at a seasonally adjusted annual rate of $503.7 billion in October, 2.0 percent (±1.3%) below the revised September estimate of $514.2 billion. Nonresidential construction was at a seasonally adjusted annual rate of $359.4 billion in October, 0.5 percent (±1.1%)* below the revised September estimate of $361.1 billion.

Further declines in residential construction is widely expected, but also note the small decline in private nonresidential construction spending.

Click on graph for larger image.

The graph shows private residential and nonresidential construction spending since 1993.

Over the last couple of years, as residential spending has declined, nonresidential has been very strong. But it now appears that nonresidential construction may be slowing. This is just one month of data, and one month does not make a trend, but there is other evidence - like the Fed's Loan Officer Survey - that suggests a slowdown in nonresidential has arrived.