Construction slips in fourth quarter.
Contracting for new construction dropped 1% in October to a seasonally adjusted Seasonally adjusted
Mathematically adjusted by moderating a macroeconomic indicator (e.g., oil prices/imports) so that relative comparisons can be drawn from month to month all year. rate of $490.1 billion, according to according to
1. As stated or indicated by; on the authority of: according to historians.
2. In keeping with: according to instructions.
3. the F.W. Dodge division of The McGraw-Hill Companies. Residential building continued its gradual retreat of recent months, while a sharper decline was reported for non-building construction after a very strong September. Running counter to this downward trend was improvement for nonresidential building.
October's data produced a reading of 148 for the Dodge Index, compared to a revised 149 for September. After beginning the year at 153, the Index receded to 142 by August, so the September and October levels were within the upper half of this year's range of contracting. "The construction industry has yet to see a sustained loss of momentum, as it remains one of the better performers in this year's faltering economy," said Robert A Murray. vice president of economic affairs for F.W. Dodge. "When commercial building weakened weak·en
tr. & intr.v. weak·ened, weak·en·ing, weak·ens
To make or become weak or weaker.
weaken·er n. earlier in 2001, the slack 1. (operating system) slack - Internal fragmentation. Space allocated to a disk file but not actually used to store useful information.
2. (jargon) slack was picked up by other project types. In October, improved contracting for commercial and institutional building partially offset the declines reported for single-family housing, public works public works
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. , and electric utilities."
Residential building in October decreased 4% to $2044 billion. Single-family housing was down 5%, while multifamily housing registered a 7% gain. For most of 2001, single family housing has proceeded at a healthy clip -- only two months, February and October, have been below the previous year's average monthly pace.
Murray noted that "The single-family decline in October will likely be followed by further slippage Slippage
The difference between estimated transaction costs and the amount actually paid.
Slippage is usually attributed to a change in the spread.
See also: Spread, Transaction Costs
Slippage in the next few months, given diminished di·min·ish
v. di·min·ished, di·min·ish·ing, di·min·ish·es
a. To make smaller or less or to cause to appear so.
b. consumer confidence and falling employment levels At the same time, the retreat for construction should stay moderate, as low mortgage rates continue to support homebuyer home·buy·er
One who is in the process of buying a home. demand."
By geography, residential building showed this pattern in October -- the South. Atlantic, up 2%; the South Central, down 4%; the Northeast, down 5%; the Midwest, down 6%; and the West, down 7%.
Non-building construction, at $113.5 billion, fell 12% in October. The comparison is against an exceptionally strong September and October was still more than 20% above the average monthly pace for non-building construction in 2000. Electric power plant construction in October dropped 21%, highways and bridges were down 19%, while relatively small declines were registered by sewers (4%), water supply systems (2%), and river/harbor development (1%).
Nonresidential building in October advanced 11% to $172.1 billion. The commercial categories in particular showed unexpected gains following depressed contracting during the summer. Hotel construction jumped 73% after a very weak September, boosted by the start of a $115 million convention-center related hotel in Houston Texas and a $75 million casino-related hotel in Henderson NV. Warehouses were up 29%, while office construction grew 16%. Store construction in October posted a 2% gain.
The institutional side of the nonresidential market featured a 7% gain for schools, as this structure type continues to show strength, and a 36% increase for healthcare facilities. On the negative side, public buildings were down 12%, and amusement-related projects plunged 33%. The nonresidential total was also constrained con·strain
tr.v. con·strained, con·strain·ing, con·strains
1. To compel by physical, moral, or circumstantial force; oblige: felt constrained to object. See Synonyms at force.
2. by continued weakness for manufacturing plant construction, which fell 36% in October.
Through the first ten months of 2001, total construction 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.
This method of calculating depreciation is used for ACRS and MACRS. was 3% higher than the same period in 2000. By major sector, residential building was up 4% and non-building construction surged 14%, but nonresidential building trailed its 2000 amount by 5%. By region, total construction in the January-October period showed this pattern -- the South Central, up 6%; the West, up 4%; the Midwest, up 3%; the South Atlantic, unchanged; and the Northeast, down 1%.