News & Events

Economic Advisor: February 7, 2018
February 7, 2018


Spending on construction continued to grow, while the economy added jobs, and layoffs declined.

Construction Spending

Construction grew 0.7 percent in December to hit an annual rate of $1.253 trillion, according to last week’s report from the Census Bureau. Compared to the same period last year, December’s spending was 2.6 percent higher than December 2016’s rate of $1.221 trillion.

Spending on private construction grew 0.8 percent to hit an annual rate of $963.2 billion. Residential construction spending increased 0.5 percent to hit a rate of $526.1 billion, with spending on construction of single-family homes growing 0.4 percent to reach a pace of $275.6 billion, and spending on multi-family units growing 2.6 percent to hit a rate of $64 billion.

All told, the total value of construction during 2017 amounted to $1.230 trillion, which was 3.8 percent higher than 2016’s total spending of $1.185 trillion. Growth in construction spending has slowed over the past 24 months due to a variety of factors, but housing market watchers continue to underscore the need for additional new inventory in order to control home prices and maintain sales volume.


The U.S. economy added 200,000 jobs in January, which was slightly above market expectations of 190,000, according to last week’s report from the Bureau of Labor Statistics. Growth sectors for jobs included construction, food services and drinking establishments, healthcare, and manufacturing.

That growth held the unemployment rate at 4.1 percent with the number of unemployed Americans totaling 6.7 million. The number of people unemployed for 27 weeks or longer — the long-term unemployed — hovered at 1.4 million in January, representing 21.5 percent of the total unemployed population. Americans employed on a part-time basis, for reasons such as their hours being cut or that being the only work they could find, held at five million people.

Hourly earnings grew by nine cents in January to reach $26.74, following December’s 11-cent gain. Over the year, hourly earnings increased by 75 cents, or 2.9 percent.

Initial Jobless Claims

First-time claims for unemployment benefits filed by the newly unemployed during the week ending January 27 ticked down to 230,000, a slight drop of 1,000 claims from the prior week’s total of 231,000, according to last week’s report from the Employment and Training Administration.

The four-week moving average, which is considered a more stable measure of jobless claims, fell to 234,500, a decrease of 5,000 claims from the preceding week’s average of 239,500 claims.

This latest report marked the 152nd straight week that initial claims have come in below the 300,000-claim level, which economists consider an indicator of a growing job market. The Administration added that it continues to experience hurricane-related reporting difficulties in the Virgin Islands and Puerto Rico.

This week, we can expect:

  • Tuesday — The foreign trade balance for December from the Bureau of Economic Analysis.
  • Wednesday — Consumer credit for December from the Federal Reserve.
  • Thursday — Initial jobless claims for last week from the Employment and Training Administration.
  • Friday — Wholesale trade for December from the Census Bureau

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