Real gross domestic product (GDP) expanded by just 0.7% (seasonally adjusted annual rate) during the fourth quarter of 2015, according to an analysis of Bureau of Economic Analysis data released by Associated Builders and Contractors (ABC). This paltry growth follows a 2% increase during the year's third quarter and a 3.9% increase during the second quarter. For the year, GDP expanded by 2.4%, matching the rate of growth seen in 2014.
Nonresidential fixed investment shrank by 1.8% in the fourth quarter, the first time the segment has contracted since the third quarter of 2012. For the year, nonresidential fixed investment expanded by 2.9% after growing by 6.2% in 2014 and 3% in 2013.
"The economy did not end the year well," ABC Chief Economist Anirban Basu said. "Today's GDP data adds weight to the argument that the U.S. is in a corporate profits recession, an industrial recession, and was experiencing a softening of investments. With the exception of the residential building sector, business capital outlays have declined as corporations deal with a combination of sagging exports, competitive imports, declining energy related investments, rising wage pressures and healthcare costs.
"Recent turbulence in financial markets suggest that capital availability may continue to soften," Basu said. "While residential construction is likely to continue to recover given the combination of low interest rates and accelerating household formation, nonresidential construction spending growth may begin to sputter a bit as those who deploy capital become more defensive. This is not to suggest that nonresidential construction spending is set to decline. Many contractors continue to report significant and growing backlog. However, the current situation suggests that the growth in backlog and ultimately in spending may not be quite as rapid as it was earlier in 2015."
Six key input prices rose or remained unchanged in October on a monthly basis, while one remained unchanged:
- Personal consumption expenditures expanded 2.2% in the fourth quarter after growing by 3% in the third quarter.
- Spending on goods grew 2.4% in the fourth quarter after expanding 5% in the third quarter and 5.5% in the second quarter.
- Real final sales of domestically produced output increased 1.2% for the fourth quarter after a 2.7% increase in the third quarter.
- Federal government spending increased 2.7% in the fourth quarter, the segment's largest increase since the third quarter of 2014.
- Nondefense spending increased 1.4% in the fourth quarter after expanding 2.8% in the previous quarter.
- National defense spending expanded by 3.6% in the fourth quarter after contracting by 1.4% during the third.
- State and local government spending contracted by 0.6% in the fourth quarter after increasing by 2.8% in the third quarter.
Related Stories
K-12 Schools | May 16, 2022
Private faculty offices are becoming a thing of the past at all levels of education
Perkins & Will’s recent design projects are using the area to encourage collaboration.
Codes and Standards | May 16, 2022
AIA releases Justice in the Built Environment guide
The American Institute of Architects (AIA) recently published a new supplementary edition of the Guides for Equitable Practice, titled “Justice in the Built Environment.”
K-12 Schools | May 16, 2022
A Quaker high school in Maryland is the first in the U.S. to get WELL Gold certification
Designed by Stantec, a Quaker high school is the first in the US to receive WELL Gold certification, which recognizes a commitment to occupants’ health and well-being.
Building Team | May 13, 2022
Glass penthouses rise above Toronto’s tree line
In midtown Toronto, the nine-story midrise building Leaside Common has released its Penthouse Collection: two-floor penthouses that take inspiration from Philip Johnson’s Glass House in Connecticut.
Market Data | May 12, 2022
Monthly construction input prices increase in April
Construction input prices increased 0.8% in April compared to the previous month, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics’ Producer Price Index data released today.
Codes and Standards | May 12, 2022
Solar industry creates non-profit to remove barriers to clean energy deployment
The Solar Energy Industries Association (SEIA) is launching a 501(c)3 non-profit organization to accelerate the transition to carbon-free electricity.
School Construction | May 11, 2022
New Digital Learning Commons at Rutgers supports doctoral programs in over 16 disciplines
The new Digital Learning Commons at the Rutgers University Archibald S. Alexander Library provides students in over 16 courses of study and four professional schools with spacious collaborative and study space.
Esports Arenas | May 11, 2022
Design firm Populous partners with esports company on digital art NFT collection
Design firm Populous and multidiscipline esports organization Kansas City Pioneers have partnered on a five-part NFT collection.
Multifamily Housing | May 11, 2022
Kitchen+Bath AMENITIES – Take the survey for a chance at a $50 gift card
MULTIFAMILY DESIGN + CONSTRUCTION is conducting a research study on the use of kitchen and bath products in the $106 billion multifamily construction sector.
Building Team | May 11, 2022
Miami to get its first supertall building
After completing its first supertall building, 111 W 57th Street in New York, developer PMG is now preparing for the groundbreaking of the first supertall in Miami: Waldorf Astoria Miami.
