CIRB: California Construction Volume Declines 26.2 Percent.

BURBANK, Calif. -- California's statewide construction volume for July is $6.22 billion, down 26.2 percent from June but up 1.7 percent from July 2003.

According to statistical data compiled by the Construction Industry Research Board (CIRB), all major construction sectors are down from the prior month. The largest decline in July is in public works construction (highway-heavy plus government owned buildings -- including schools and colleges) which total $1.29 billion, down 49.3 percent from June.

Ben Bartolotto, Director of CIRB, says the drop in public works construction from June 2004's $2.54 billion to July's $1.29 billion "May have been exaggerated due to a surge of contract awards prior to the end of the fiscal year ending June 30, 2004." In addition, there were no roads and bridge projects larger than $20 million in July. The major heavy construction projects for the month were three water and sewerworks, two in Sacramento totaling $60.8 million and a $40.2 million project in Ventura County.

In the first seven months of 2004 however, public works construction totals $10.45 billion, up $456.6 million or a 4.6 percent increase for the same period in 2003. CIRB is forecasting public works construction at $16.63 billion for this year, up slightly at 0.7 percent.

Meanwhile, California's private building activity (residential and nonresidential construction) totals $4.93 billion in July, down 16.3 percent from June 2004 but up 5.7 percent from July 2003. CIRB analysts report all private building sectors in July were down with multi-family housing showing the largest decline at 34.6 percent from the previous month.

Permits issued in July 2004 for private nonresidential activity have a total construction value of $1.27 billion, down $356.0 million or 21.9 percent from June and down $1.62 million or 1.3 percent decline from July 2003. Director Bartolotto says this abrupt drop is due mainly "to a $290 million one-month drop in Riverside County following a larger increase in June in the same area." A new transportation mitigation fee on commercial and industrial building in Riverside County went into effect July 1 resulting in a plethora of permits in June. CIRB says declines like July's typically follow the unexpected surge in activity.

Still, private nonresidential building year-to-date totals $8.91 billion, up $785.8 million or 9.7 percent increase from the same period last year. Southern California accounts for 83.2 percent of the statewide increase in the first seven months of 2004 and the bulk of this region's increase is in Riverside and San Bernardino Counties.

Construction employment in July 2004 is down 3,400 from June but is still up 25,300 from July 2003. According to Director Bartolotto, this construction employment increase from July 3003 accounts for 20.1 percent of California's net payroll employment increase of 125,800 nonfarm jobs over the same period.