U.S. construction spending fell in January, reflecting weakness in spending on office buildings and other nonresidential projects and in government activity.
Construction spending fell 1.1 per cent in January following a revised 0.8 per cent increase in December, the Commerce Department reported Monday.
Spending on home construction rose 0.6 per cent but spending on nonresidential projects dropped 1.6 per cent, reflecting declines in hotels, office buildings and the category that covers shopping centres. Spending on government projects also declined in January, falling 2.8 per cent.
Private economists had predicted a small overall gain in January.
The unusually severe weather in many parts of the country in January could have had an impact activity. Economists expect the weakness will be temporary and are forecasting a rebound in activity once winter storms stop disrupting plans.
In January, spending on single-family homes rose 0.6 per cent and spending on apartment buildings rose an even stronger 1.9 per cent.
The weakness in nonresidential projects was led by a 5.7 per cent drop in the category that covers shopping centres.
The 2.8 per cent drop in spending on government projects followed a 1.7 per cent rise in December.
Over the course of 2014, spending on offices, power plants, factories and hotels and motels climbed significantly, a potential sign of broader economic growth in 2015.
The solid gains helped boost job growth in the construction industry, which added nearly 3 million jobs in 2014, the most since 1999.
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