Auction.com: Growth Slows to a Crawl
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IRVINE, CA-The US Census Bureau of the Department of Commerce has revealed that construction spending during May was estimated at a seasonally adjusted annual rate of $874.9 billion, which is 0.5% above the revised April estimate of $870.3 billion. The May figure is 5.4% above the May 2012 estimate of $830.4 billion, but has not met economists’ expectations for an economy that some experts say should be well into recovery by now.
According to Julie Zisfein, senior associate and economist at Auction.com Research here, the May construction-spending report finds that growth has slowed to a crawl. Zisfein said in a prepared statement that the construction-spending data’s findings are “falling short of expectations yet again. While this is an improvement from the 0.1% gain in April, spending has been subdued over the past six months, hovering around the $870-billion mark after increasing at a somewhat faster pace throughout 2011 and early 2012.”
The report also noted that spending on private construction was at a seasonally adjusted annual rate of $605.4 billion, nearly the same as the revised April estimate of $605.7 billion, and that residential construction was at a seasonally adjusted annual rate of $322.3 billion May, 1.2% above the revised April estimate of $318.5 billion. Nonresidential construction was at a seasonally adjusted annual rate of $283.1 billion in May, 1.4% below the revised April estimate of $287.1 billion, according to the report.
In the public-construction realm, the estimated seasonally adjusted annual rate of spending was $269.5 billion in May, 1.8% above the revised April estimate of $264.7 billion. Educational construction was at a seasonally adjusted annual rate of $60.4 billion, 0.4% above the revised April estimate of $318.5 billion, and highway construction was at a seasonally adjusted annual rate of $78.4 billion, 0.8% above the revised April estimate of $77.7 billion.
Other economic indicators reflect Auction.com Research economists’ concerns that the economy may not be as strong as some reports would have us believe. As GlobeSt.com reported last week, Peter Muoio, senior principal and economist with the firm, says that the final first-quarter GDP estimate hints at more weakness across key growth-driving components of the economy.
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