Construction spending rebounded in April from Stimulus

Construction spending rebounded strongly this April, with a $23 billion increase to a seasonally adjusted annual rate of $869 billion, a 2.7% growth, according to the latest analysis of federal spending figures released by the Associated General Contractors of America.

Public construction was up 2.4%, above the 1.7% increase in private nonresidential construction but below the 4.4% increase in private residential construction.

Ken Simonson, chief economist for the construction trade association, noted that the stimulus drove significant increases in a range of public construction categories.

“The stimulus is clearly driving one of the biggest increases in construction spending the industry has experienced in a long time,” said Simonson.

Despite the rebound, Simonson remained skeptical of the recovery efforts. Simonson noted that the stimulus funding remains the main source of support for nonresidential contractors.

“Once you look beyond the stimulus, however, these figures show how uneven and fragile the construction recovery remains,” said Simonson.