Still good news in nonresidential
Washington, D.C. - The nation's nonresidential construction market apparently hasn't received the memo that the nation is teetering toward a recession.

"Nonresidential construction spending rose an impressive 1.3 percent in March and 12 percent compared to March 2007," said Ken Simonson, chief economist for the Associated General Contractors of America (AGC) on May 1.

He was commenting on the March construction spending figures released by the Census Bureau the same day. "The housing slump buried this news by dragging total spending down by 1.1 percent for the month and 3.4 percent for the year," Simonson added. "Yet nearly every category of nonresidential spending continued to exceed year-ago levels."

Simonson said private and public nonresidential construction is a sector that's still growing, "although public spending is losing speed." He said private nonresidential spending was up 15 percent from March 2007, while public spending grew 7.2 percent.

The AGC forecaster said public spending on construction is expected to flatten or shrink for highways, schools and other public projects. For private construction, he expects "ongoing vigor" in spending on power, energy, communications, hospital, higher education and military base-related projects, offset by a likely retreat by office and retail construction.

The biggest challenge this year: "runaway materials costs," Simonson warned. "Yesterday, a steel supplier told customers the price of re-bar was rising another $100 overnight, compounding increases of 40 to 70 percent earlier this year. The retail price of diesel fuel is now almost 50 percent higher than a year ago. Copper is close to its all-time high set in May 2006, and near-record prices for oil and natural gas may push up asphalt and plastics prices."

Laborers leave; alliance dissolves
Average hourly construction earnings moved up 4.4 percent from March 2007 to February 2008, according to a report issued last month by the U.S. Bureau of Labor Statistics.

However, taking the inflation rate into account, the increase only amounted to .01 percent.

The pay hikes for construction were an improvement over the average U.S. workforce, which jumped 3.9 percent. But adjusted for inflation, the pay hikes weren't hikes at all: the BLS numbers show that in real dollars, all non-supervisory American workers saw their earning power drop by .4 percent.

The average weekly wage in America for all workers as of February is $607.49, or $31,589 per year. The nation's construction workers do even better, on average earning $828.36 per week, or $43,074 per year.