WASHINGTON, DC-The Associated General Contractors ofAmerica points to a surprising—and rare—green shoot ofeconomic activity after weeks of discouraging indicators.Construction spending in May reached the highest level sinceDecember 2009, fueled by a robust private-sector pipeline,especially in the residential and multifamily sectors, it reportsafter analyzing federal data. This growth was strong enough tooffset the ongoing decline in public-sector building.

The analysis follows the recent enactment of a federal highwayand transportation bill that slightly increases spending over thenext two years and three months. Despite the certainty of having afederal budget in place—after nearly three years of temporaryextensions--the association’s analysis still points to aconstruction sector that will continue to be fueled by privateactivity. It found that residential construction rose 3% in May and8% year-over-year. New multifamily construction rose by 6% and aneye-popping 50%, respectively, while single-family homebuilding wasup 2% and 15%. By contrast, public construction dropped for thefifth consecutive month in May, falling 4% below the May 2011level.

“It is encouraging to see such a broad-based pickup in privateconstruction,” said Ken Simonson, theassociation’s chief economist, in a prepared statement.