F.W. Dodge Index Reaches 144

The value of new construction contracts increased 3 percent in April to a seasonally adjusted annual rate of $476.5 billion, according to the F.W. Dodge Division of the McGraw-Hill Companies. Moderate growth was reported for two of the three major industry sectors, nonresidential building and nonbuilding construction, while residential building witnessed only slight improvement compared to the previous month.

April's data lifted the Dodge Index to 144 (1996=100), up from 139 in March. The Dodge Index reached its most recent peak in January at 152, and then experienced a loss of momentum over the next two months. The April reading for the Dodge Index was slightly above its average of 142 for all of 2000. "April's rebound is consistent with the sense that the construction industry is leveling off close to last year's volume, as opposed to being in the early stages of a sustained decline," stated Robert A. Murray, vice president of economic affairs for F.W. Dodge. " The general economic slowdown has raised concern about construction's near term prospects, but so far in 2001, the construction industry has been able to hold up reasonably well. At the same time, it's also true that the full impact of slower employment growth and tighter bank lending standards have yet to be felt by commercial building and housing."

Nonresidential building climbed 6 percent to $173.7 billion.