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
| Dec 27, 2011
Ground broken for adaptive reuse project
Located on the Garden State Parkway, the master-planned project initially includes the conversion of a 114-year-old, 365,000-square-foot, six-story warehouse building into 361 loft-style apartments, and the creation of a three-level parking facility.
| Dec 27, 2011
Nova completes $60M Clearwater Conference Center
Comprising an entire city block, the 450,000 sq. ft. facility features over 400 meeting rooms, six theaters, a full-service health spa, complete with an indoor running track, and a commercial kitchen that can efficiently accommodate over 1,000 diners
| Dec 27, 2011
BD+C's Under 40 Leadership Summit update
The two-day Under 40 Leadership Summit continued with a Leadership Style interactive presentation; Great Solutions presentations from Under 40 attendees; the Owner’s Perspective panel discussion; and the Blue Ocean Strategy presentation.
| Dec 27, 2011
Suffolk Construction celebrates raising of Boston Tea Party Ships & Museum cupola
Topping off ceremony held on 238th Anniversary of Boston Tea Party.
| Dec 27, 2011
State of the data center 2011
Advances in technology, an increased reliance on the Internet and social media as well as an increased focus on energy management initiatives have had a significant impact on the data center world.
| Dec 27, 2011
USGBC’s Center for Green Schools releases Best of Green Schools 2011
Recipient schools and regions from across the nation - from K-12 to higher education - were recognized for a variety of sustainable, cost-cutting measures, including energy conservation, record numbers of LEED certified buildings and collaborative platforms and policies to green U.S. school infrastructure.
| Dec 21, 2011
DOE report details finance options for PV systems in schools
The report examines the two primary types of ownership models used to obtain PV installations for school administrators to use in selecting the best option for deploying solar technologies in their districts.
| Dec 21, 2011
AIA Chicago & AIA Chicago Foundation 2011 Dubin Family Young Architect Award announced
The Dubin Family Young Architect Award is bestowed annually and recognizes excellence in ability and exceptional contributions by a Chicago architect between the ages of 25 and 39.
| Dec 21, 2011
Few silver linings for construction in 2012
On the brighter side, nearly half of respondents (49.7%) said their firms were in at least “good” financial health, and four-fifths (80.2%) said their companies would at least hold steady in revenue in 2012.
| Dec 21, 2011
BBI key to Philly high-rise renovation
The 200,000 sf building was recently outfitted with a new HVAC system and a state-of-the-art window retrofitting system.