Building spending in US falters
By Martin Crutsinger |
August 3, 2010, Tuesday
|
Print Edition
Print Edition
CONSTRUCTION spending in the United States edged up in June but all the strength came from the government. Private sector activity in both housing and nonresidential projects fell.
Construction spending rose 0.1 percent in June, the US Commerce Department reported yesterday. While that was better than the decline economists had forecast, the government sharply revised down its estimate of activity in May to show a drop of 1 percent rather than the 0.2 percent dip initially reported.
The lackluster performance for construction was the latest indicator that the overall economy slowed in the spring, raising worries about the durability of the recovery that began a year ago.
The government reported last week that total economic growth slowed to a rate of 2.4 percent in the April-June quarter, down from a 3.7 percent growth rate in the first three months of the year and a 5 percent growth spurt in the fourth quarter of 2009.
Economists are worried that growth will slow even more in the second half of this year as still high unemployment restrains consumer spending and the impact of the government's massive stimulus programs fade.
The impact of the withdrawal of government support was evident in the housing sector in June. Spending on housing construction fell for a second consecutive month, dropping 0.8 percent after an even bigger 1.5 percent decline in May.
The federal government's popular home buyers' tax credit expired on April 30 and since that time housing construction and sales have both taken sharp declines.
Construction spending rose 0.1 percent in June, the US Commerce Department reported yesterday. While that was better than the decline economists had forecast, the government sharply revised down its estimate of activity in May to show a drop of 1 percent rather than the 0.2 percent dip initially reported.
The lackluster performance for construction was the latest indicator that the overall economy slowed in the spring, raising worries about the durability of the recovery that began a year ago.
The government reported last week that total economic growth slowed to a rate of 2.4 percent in the April-June quarter, down from a 3.7 percent growth rate in the first three months of the year and a 5 percent growth spurt in the fourth quarter of 2009.
Economists are worried that growth will slow even more in the second half of this year as still high unemployment restrains consumer spending and the impact of the government's massive stimulus programs fade.
The impact of the withdrawal of government support was evident in the housing sector in June. Spending on housing construction fell for a second consecutive month, dropping 0.8 percent after an even bigger 1.5 percent decline in May.
The federal government's popular home buyers' tax credit expired on April 30 and since that time housing construction and sales have both taken sharp declines.
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