In July, U.S. construction spending climbed to its highest level in seven years, bolstered by an increase in residential construction, factories and power plants. Total construction spending has risen thirteen point seven percent over the past twelve months. As reported by the Associated Press, the surge in construction spending has induced some forecasters to alter their projections for economy-wide growth.
For instance, analysts at Barclays now project that the economy is on track to expand two point six percent during the current quarter and that second quarter growth will be revised up to three point eight percent. Construction, both residential and nonresidential, has emerged as one of the economy’s most important growth drivers.
The sector’s outlook remains bright, with single family housing starting now at its highest level since December two thousand and seven. A strong U.S. auto sector is helping to drive investment and construction in the nation’s factories. Spending by the government on construction continues to be soft, however, with the exception of construction and maintenance of highways and streets.