Construction spending marks fifth decline in six months

Written by Phoenix Business Journal.

With the housing market mired in a slump, construction spending is dropping quickly.

The U.S. Commerce Department reports that construction spending nationwide fell 1.1 percent in March, to a seasonally adjusted annual rate of $1.1 trillion. That's the fifth decline in the past six months. Building activity has fallen sharply in the face of a steep slump in housing and a general economic slowdown.

The weakness was led by a 4.6 percent drop in private residential spending, the biggest monthly drop on records going back to 1993. Housing construction had dropped for 23 consecutive months before a small increase in February. But the sector remains down as builders struggle to reduce high levels of inventory in the face of poor demand.