Construction spending up slightly in April, employment down in May
the Monthly Construction Metals Index (MMI) held flat for reading this month.
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US construction spending on the rise in April
Construction spending in the United States reached a seasonally adjusted annual rate of $ 1,524.2 billion in April, the Census Bureau reported.
The estimated rate for April marked an increase of 0.2% from the previous month and an increase of 9.8% year-over-year.
Construction spending amounted to $ 452.3 billion in the first four months of the year, up 5.8% from the same period in 2020.
Meanwhile, private construction spending reached a seasonally adjusted annual rate of $ 1,180.7 billion, up 0.4% from March. Under the aegis of private construction, residential construction rose 1.0% to $ 729.2 billion in April. Non-residential construction fell 0.5% to $ 451.4 billion in April.
Public spending on construction fell 0.6% to $ 343.5 billion. Spending on construction of educational institutions fell 0.5% to $ 84.8 billion. Highway construction rose 0.6% to $ 99.8 billion.
Construction employment declines in May
On the labor side, construction employment fell by 20,000 in May, the Census Bureau reported. Construction employment is down 225,000 from February 2020.
The Associated General Contractors of America noted that contractors continue to struggle with unpredictability when it comes to securing materials.
“The steadily worsening production and delivery delays have exceeded even record cost increases for many materials as the biggest headache for many non-residential contractors,” said Ken Simonson, chief economist of the association. “If they can’t get the materials, they can’t put the employees to work. “
ABI posts growth for third consecutive month
For the third consecutive month, the Architecture Billings Index, published monthly by the American Institute of Architects, showed growth (i.e. an index value greater than 50).
After the start of the pandemic, the ABI had contracted every month for a year until the February 2021 reading.
For April, the ABI came in at 57.9, down from 55.6 the month before. The design contract index reached 61.7, up from 55.7 the previous month.
The ABI marked its highest level since before the Great Recession.
“Interest in new projects also remained extremely strong, with the Inquiries score reaching 70.8 and the value of new design contracts signed reaching 61.7, the highest score on this index since the start of the year. data collection at the end of 2010, ”said the ABI report. “This means that not only are clients talking to architectural firms about starting new projects, but they are also signing contracts to start this work at a high rate. “
By region, the Midwest led the way with an ABI reading of 60.6. Lagging behind the Midwest were the South (58.3), Northeast (55.0) and West (52.4).
As we have regularly noted in this space, shortages and delays in receiving materials have had a ripple effect. The sudden increase in demand in some sectors has produced a boost.
The ABI report noted the 0.8% jump in the consumer price index from March to April and the 4.2% jump from April 2020 to April 2021, which marked the largest increases since before. the Great Recession.
“In addition, core inflation rose 0.9% in April, the largest increase in this indicator since 1981,” notes the ABI report. “The rise in consumer prices at the moment is largely caused by supply constraints due to a shortage of key inputs resulting in subsequent delays in production, and by a growing demand for services, especially travel and hospitality. “
While waiting for the drop in home sales in April
Meanwhile, in the housing market, pending home sales fell 4.4% in April, the National Association of Realtors (NAR) reported.
“Contract signatures are approaching pre-pandemic levels after the surge due to the lack of sufficient supply of affordable housing,” said Lawrence Yun, chief economist of NAR. “The high-end market is still evolving strongly because stocks are more abundant there. “
Real metal prices and trends
The price of Chinese rebar fell 0.7% month-on-month to $ 802 per metric tonne. Meanwhile, the Chinese H-beam steel price fell 2.3% to $ 815 per metric tonne.
The US price for shredded scrap rose 3.2% to $ 450 per short ton.
The European price of commercial 1050 aluminum sheet increased 0.4% to $ 3,577 per metric tonne.
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