Commercial building lags behind other sectors in Jan.A one percent setback in 1992's opening month left the seasonally adiusted Dodge Index of construction contract value at 95, one point short of its best value in the past year and a half. This leading indicator Leading Indicator A measurable economic factor that changes before the economy starts to follow a particular pattern or trend. Leading indicators are used to predict changes in the economy, but are not always accurate. of spending for ongoing construction, which now uses 1987 as its 100 base, has shown modest but steady improvement since early in 1991. "A stubbornly depressed nonresidential building market is keeping the construction sector from realizing its full potential," said George A. Christie, vice president and chief economist The Chief Economist is a single position job class having primary responsibility for the development, coordination, and production of economic and financial analysis. It is distinguished from the other economist positions by the broader scope of responsibility encompassing the for F.W. Dodge. "Even after the long recession, lingering lin·ger v. lin·gered, lin·ger·ing, lin·gers v.intr. 1. To be slow in leaving, especially out of reluctance; tarry. See Synonyms at stay1. 2. weakness in commercial and industrial building is offsetting very substantial gains in one family housing and public works public works pl.n. Construction projects, such as highways or dams, financed by public funds and constructed by a government for the benefit or use of the general public. Noun 1. construction." "Call 1992 a |Two-H Year'," Christie said. "Homebuilding and highways are where the action is." January's value of total residential building continued its steady climb with a solid 11 percent advance over December's rate of contracting. The year-long recovery of the housing market has lifted the current rate of residential building 40 percent above the January 1991 low. All of that improvement has been in single family building. "Favorable fa·vor·a·ble adj. 1. Advantageous; helpful: favorable winds. 2. Encouraging; propitious: a favorable diagnosis. 3. interest rates and the prospect of a tax credit for first time home buyers will keep the one family housing recovery going through 1992 even though the overdeveloped rental/condo market remains dormant Latent; inactive; silent. That which is dormant is not used, asserted, or enforced. A dormant partner is a member of a partnership who has a financial interest yet is silent, in that he or she takes no control over the business. ," the Dodge economist said. Contracting for public works construction, which surged to an alltime high in December, held within two percent of that record rate in January. Support for public works construction is developing through two sources: accelerated spending of appropriations for existing public construction programs, which will give the economy a needed boost, and the newly passed $150-plus billion highway program, which will greatly escalate es·ca·late v. es·ca·lat·ed, es·ca·lat·ing, es·ca·lates v.tr. To increase, enlarge, or intensify: escalated the hostilities in the Persian Gulf. v.intr. the development of the nation's transportation network. Contracting for non-residential buildings fell back 12 percent in January after showing a hint of improvement in the previous month. "Although 1991 gave us two or three encouraging months, it is evident that commercial building is far from ready for a sustained recovery," Christie said. On an unadjusted basis Unadjusted Basis A basis used for depreciation purposes. Unadjusted basis uses the original cost of property or equipment without regard to salvage value. Notes: This method of calculating depreciation is used for ACRS and MACRS. , January's contracting for new construction, at $16.1 billion, exceeded the weak year-ago value by 14 percent. All regions reported double-digit gains except the West, where contracting declined 2 percent from last January's total. |
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