Construction spending had been expected to recover from the 0.2 percent loss it suffered in December. Analysts polled by Econoday were looking for an increase of 0.2 to 0.8 percent, with a consensus of a half-point gain. Instead total January construction expenditures fell to $1.18 trillion on a seasonally adjusted annual basis from a revised December estimate of $1.19 trillion (down from $1.2 trillion), a decrease of 1.0 percent. The January number did outpace the annual rate of $1.15 trillion from January 2016 by 3.1 percent. On an unadjusted basis, total spending in January was $81.32 billion, down from $91.53 billion in December.
The downturn in overall spending was almost entirely attributable to the public sector, and privately funded construction did eke out a slight month-over-month gain. Total spending ticked up 0.2 percent from December to $911.6 billion on a seasonally adjusted annual basis. The December number was also revised up significantly, to $909.4 billion from $897.0 billion. January non-seasonally adjusted spending was 7.3 percent above expenditures a year earlier.
Residential spending strengthened during the first month of the year, but perhaps not enough to do much for the extremely tight single-family housing inventories. Overall residential expenditures were at a seasonally adjusted $476.40 billion, up a half-point from December and 5.9 percent higher than in January 2016. Single-family construction was at a rate of $253.81 billion and multi-family $63.54 billion, month-over-month gains of 1.1 and 2.2 percent respectively. Single-family spending was 2.3 percent higher than in January of last year and multi-family continued strong with a 9.0 percent gain. On a non-adjusted basis $17.59 billion was spent during the month on single family construction, compared to $18.69 billion in December and multi-family spending was virtually unchanged from the previous month at $4.81 billion.
Publicly funded construction in January fell by 5.0 percent from December and 9.0 percent compared to January 2016. Total public spending was at an annual rate of $269.69 billion. Virtually every category of spending was down from the previous January.