Construction up 4 percent vs. 2011
Through the first ten months of 2012, total construction starts on an unadjusted basis came in at $390.4 billion, a 4 percent gain relative to the same period a year ago, according to a Nov. 20 report by McGraw-Hill Construction.
But the value of new construction starts retreated 14 percent in the month of October to a seasonally adjusted annual rate of $434.9 billion. Much of the decline was due to a sharp pullback by the electric power and gas plant category after a robust September . If this volatile project type is excluded from the month-to-month comparisons, total construction starts in October would register a 3 percent gain.
Greater activity was reported in October for the public works sector, while both nonresidential building and housing settled back.
“This year’s pattern for total construction has been shaped to some degree by the swings for the electric utility and gas plant category, which is still on track to achieve a new annual high in current dollar terms, even with its weak October performance,” said Robert A. Murray, vice president of economic affairs for McGraw-Hill Construction. “Leaving out electric utilities and gas plants, the amount of construction starts in 2012 would be up 3 percent through the first ten months.”
For housing, the emerging recovery for single family housing is joining the strengthening trend for multifamily housing that’s already underway. For nonresidential building, commercial building is seeing modest growth in 2012, but this has been offset by declines for institutional building and manufacturing plant construction. Public works year-to-date has been basically flat, beginning to stabilize after its 14 percent downturn in 2011.
“While the pattern of overall construction activity does seem to be moving towards more broad-based expansion, the persistent uncertainty affecting the U.S. economy continues to pose a downside risk,” Murray said. “The degree to which policymakers in Washington DC are able to agree on the steps necessary to avert the fiscal cliff will determine whether the nascent upturn for construction continues to grow in 2013 or slides back.”
Sad perspective on Walmart
Last month, with Walmart workers all across the country undertaking up to 1,000 Black Friday job actions, the giant retailer took time out to announce that the next Walmart dividend will go out on Dec. 27 instead of Jan. 2. Why the switch? The Bush tax cut for dividends expires at year-end. Switching the date will save the billionaire heirs of Walmart founder Sam Walton as much as $180 million.
Some perspective: This $180 million would be enough to give 72,000 Walmart workers now making $8 an hour a 20% annual pay hike. That hike would still leave those workers making under the poverty line for a family of three.
Some more perspective: Back in the middle of the 20th century, Americans didn’t tolerate inequality this brazen. We lived back then in a nation that seriously taxed the rich and encouraged decent wages.
– Sam Pizzigati