The latest Construction Economic Update from the Associated Builders and Contractors (ABC) reported a 3.4% decline in nonresidential fixed investment during the first quarter of 2015. According to a recent gross domestic product report by the Bureau of Economic Analysis, the GDP rose by 0.2% during the same time.
This is the first time that nonresidential fixed investment declined since the first quarter of 2011, ABC reported.
Nonresidential fixed investment had been rising by more than 4% on an annualized basis during five of the previous six quarters.
Despite extreme weather across the country, nonresidential fixed investment expanded while energy prices were higher, causing the energy exploration, development, and distribution sectors to grow.
“Lower energy prices had an intense impact during the first quarter of 2015 and consumer spending was not enough to meaningfully offset the plummeting nonresidential fixed investment,” said ABC Chief Economic Anirban Basu. “Investment in equipment inched up just 0.1% and, while investment in intellectual property products expanded 7.8%, the third component, investment in structures, fell 23.1% during this year’s first quarter.”
Basu added that contractors and others in the building industry should remain positive in the continued expansion of the economy. Consumer spending is expected to pick up as the year goes on, which will help things return to normal levels during the second and third quarters of the year.
The following is first quarter performance of key segments:
- Personal consumption expenditures added 1.31% to GDP after contributing 2.98% in the fourth quarter.
- Spending on goods grew only 0.2% after a 4.8% increase in the fourth quarter.
- Real final sales of domestically products output – minus changes in private inventories – decreased 0.5% for the first quarter, after a 2.3% increase in the fourth quarter.
- Federal government spending expanded 0.3% in the first quarter following a 7.3% decrease in the prior quarter.
- Nondefense spending expanded 1.9% after increasing 1.5% in the fourth quarter of 2014.
- State and local government spending fell 1.5% during the first three months of the year after rising by 1.6% during the fourth quarter.
Related Stories
| Jan 30, 2014
The evolving workplace: One designer's inspiration board
"Open office" has been a major buzzword for decades, and like any buzzword, some of the novelty has worn off. I don't believe we will abandon the open office, but I do think we need to focus on providing a dynamic mix of open and closed spaces.
| Jan 30, 2014
How reverse engineering nature can spur design innovation
It’s not enough to copy nature. Today’s designers need a deeper understanding of environmental nuance, from the biome in.
| Jan 30, 2014
What to expect in the metal building industry in 2014
Every year brings changes. This one won’t be any different. We’ll see growth in some areas, declines in others. Here’s a little preview of what we’ll be writing about 2014 when 2015 comes rolling in.
| Jan 30, 2014
What's in store for healthcare capital markets in 2014?
Despite the shake up stemming from the Affordable Care Act, 2014 will be an active year in healthcare capital markets, according to real estate experts from CBRE Healthcare.
| Jan 29, 2014
Richard Meier unveils 'urban courtyard' scheme for Mexico City towers
A grand atrium, reaching some 30 stories, highlights the contemporary, bright-white design scheme unveiled this week by Richard Meier & Partners for a new mixed-use development in Mexico City.
| Jan 29, 2014
Historic church will be part of new condo building in D.C.
Sorg Architects unveiled a design scheme for 40 condos in a six-story building, which will wrap around an existing historic church, and will itself contain four residential units.
| Jan 29, 2014
Hotel, retail, recreation sectors to lead growth in 2014
AIA's Consensus Construction Forecast, a survey of the nation’s leading construction forecasters, is projecting that spending will see a 5.8% increase in 2014, led by the hotel, retail, and amusement/recreation sectors.
| Jan 29, 2014
Notre Dame to expand football stadium in largest project in school history
The $400 million Campus Crossroads Project will add more than 750,000 sf of academic, student life, and athletic space in three new buildings attached to the school's iconic football stadium.
| Jan 29, 2014
AIA honors 18 with 2014 Young Architects Award
Three recent BD+C "40 Under 40" winners are among the outstanding young architects recognized by the AIA.
| Jan 28, 2014
White Paper: How metal buildings deliver long-term value to schools
A new white paper from Star Building Systems outlines the benefits of metal buildings for public and private school building projects.
