The pace of new construction starts in May was essentially the same as April, according to McGraw-Hill Construction Dodge, a division of The McGraw-Hill Cos. The stability for total construction as a seasonally adjusted annual rate of $481.1 billion, was the result of May's improved housing activity offsetting declines for nonresidential building and nonbuilding construction. For the first five months of 2003 total construction was 5% below the same period a year ago.
The latest month's data kept the Dodge Index at 145, unchanged from April and equal to the levels reported for February and March. The Dodge Index began 2003 at 151 prior to settling back to 145 over the next four months.
"The construction industry has lost some momentum during 2003, but so far it's been a controlled descent," said Robert Murray, vice president of economic affair for McGraw-Hill Construction Dodge. "Housing continues to move at a healthy clip, and while commercial building is still weakening, its rate of decline is not as severe as a year ago. At the same time, tighter fiscal conditions have dampened both institutional building and public works, marking a change from their performance during 2001 and 2002."
Nonbuilding construction in May dropped 2% to $82 billion. The public works categories in May showed a mixed pattern. Gains were reported for water supply systems, up 2%; highways, up 5%; sewers, up 11%; and river/harbor development, up 19%. Posting declines were mass transit work, down 5%; and bridges, down 9%.
