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 20, 2011
Gluckman Mayner Architects releases design for Syracuse law building
The design reflects an organizational clarity and professional sophistication that anticipates the user experience of students, faculty, and visitors alike.
| Dec 20, 2011
Research identifies most expensive U.S. commercial real estate markets
New York City, Washington, D.C. and San Mateo, Calif., rank highest in rents.
| Dec 20, 2011
Third annual Gingerbread Build-off winners announced
Nine awards were handed out acknowledging the most unique and creative gingerbread structures completed.
| Dec 20, 2011
BCA’s Best Practices in New Construction available online
This publicly available document is applicable to most building types and distills the long list of guidelines, and longer list of tasks, into easy-to-navigate activities that represent the ideal commissioning process.
| Dec 20, 2011
Aragon Construction leading build-out of foursquare office
The modern, minimalist build-out will have elements of the foursquare “badges” in different aspects of the space, using glass, steel, and vibrantly painted gypsum board.
| Dec 20, 2011
HOAR Construction opens Austin, Texas office
Major projects in central Texas spur firm’s growth.
| Dec 19, 2011
HGA renovates Rowing Center at Cornell University
Renovation provides state-of-the-art waterfront facility.
| Dec 19, 2011
Chicago’s Aqua Tower wins international design award
Aqua was named both regional and international winner of the International Property Award as Best Residential High-Rise Development.
| Dec 19, 2011
Summit Design+Build selected as GC for Chicago recon project
The 130,000 square foot building is being completely renovated.
