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Nonresidential Construction Continues to Climb

February 06, 2008  |  from Construction Jobs Blog

On Friday, two reports were released showing that nonresidential construction sectors continue to grow, despite the drastic correction in residential construction.  The numbers for 2007 indicate that it was a rather good year for nonresidential building.

The U.S. Census Bureau of the Department of Commerce released the first report on December 2007 Construction Spending.  Nonresidential construction was at a seasonally adjusted annual rate of $380.4 billion in December, 1.3 percent above the revised November estimate of $375.6 billion.  Not only did private nonresidential construction grow in December, but it also grew significantly during the entire year.  The value of private, nonresidential construction in 2007 was $349.8 billion, 18.3 percent above the $295.7 billion in 2006.

2007 Private Construction

As you can see on the graph, private, nonresidential construction grew steadily throughout 2007.  Even though nonresidential construction grew in December, the Construction Spending report is known for its fluctuations and corrections, so its monthly data is usually taken with a grain of salt.  It is most useful for its ability to show trends over a period of months or years, and nonresidential construction is clearly trending upwards, with December’s numbers just the latest confirmation of this trend.

The Bureau of Labor Statistics’ Employment Situation Summary for January 2008 shows that nonfarm payroll employment and the unemployment rate were “essentially unchanged” last month, and the small decline in nonfarm payroll employment reflects losses in construction and manufacturing jobs balanced by growth in healthcare employment.  But the change in construction employment is not due to nonresidential building:  the decline reflects losses in residential building and residential specialty contractors.  Non-residential building lost only a handful of positions and nonresidential specialty trade contractors gained nearly 10,000 jobs. 

 

Filed: Industry-Outlook