Construction outlays – public and private, residential and non-residential – declined from May to June, as the overall annual spending pace declined by 1.8 percent following a 0.8 percent upward revision to the May rate. Home construction fell for the second consecutive month, and a four percent
decline in government spending was the largest margin of decline in
more than 10 years.

The rate of construction spending fell slightly in June, declining 1.8 percent from the May pace but remaining 5.5 percent higher than June 2013 levels. The decline was the largest since a 2.8 percent drop was recorded in
January 2011.

According to an August 1 report from the Commerce Department, overall construction reached a seasonally adjusted annual rate of $950.2 billion, compared to $967.8 billion in May, a decline of 1.8 percent. The May number is a 0.8 percent upward revision of the $956.1 billion originally estimated, which was essentially unchanged from April. At the end of June, construction expenditures for the year totaled $445.1 billion, a 7.8 percent increase over the $413.0 billion spent to that date in 2013.

Total private construction spending in June was down 1.0 percent to a seasonally adjusted annual rate of $685.5 billion, but 9.2 percent higher than the estimated $627.6 billion in June 2013 expenditures. Year-to-date private construction totaled $324.7 billion at the end of June, compared to $291.5 billion at the end of June 2013, an increase of 11.4 percent.

Residential construction spending reached a rate of $361.3 billion, down 0.2 percent month-over month but up 7.1 percent from June 2013. Private residential construction spending was at a rate of $355.9 billion, down 0.3 from an upwardly revised rate of $357.0 billion in May, and 7.4 percent higher year-over-year. Public residential construction expenditures were at the rate of $5.4 billion, up 6.3 percent from the May rate of 5.1 billion but 12.3 percent below the estimate of $6.2 billion a year earlier.

Total public construction was 4.0 percent lower in June than in May, with annual spending rates of $264.7 billion and $275.7 billion respectively. May was revised upward from an original estimate of $273.3 billion. Educational construction was at a seasonally adjusted annual rate of $59.7 billion, 4.9 percent below the revised May estimate of $62.8 billion. Highway construction was at a seasonally adjusted annual rate of $75.3 billion, 10.4 percent below the revised May estimate of $84.0 billion. On a non-seasonally adjusted basis there was an estimated $60.7 billion in private construction put in place in June, $33.0 billion of which was residential. In May the respective figures were $58.9 billion and $31.1 billion.