Private nonresidential spending climbed 0.4% and 17%, apparently
untouched so far by either the housing meltdown or the credit market turmoil
that accelerated in July. The three most speculative components-commercial,
office and lodging-all advanced. Commercial construction was up 0.6% for the
month and 15% YTD. The two biggest commercial subcomponents-multi-retail (“big
box” and other general merchandise stores, shopping centers and malls) and
warehouses-both leaped 4% in July and 18% YTD. Private office construction
climbed 0.6% and 22%, and lodging shot up 0.8% and 60%. Other strong gainers
included power, up 0.5% and 19%, and private health care (principally
hospitals), up 1.3% and 13%. Communication fell 2.2% for the month but rose 21%
YTD.
Public
construction was up 0.7% in July and 11% YTD. The biggest
component, education, rose 1.9% and 12%. But highway and street construction,
which received a big boost in 2006 from the August 2005 enactment of the
federal authorization law known as SAFETEA-LU, was down 0.8% for the month and
was only 5% higher YTD.