Construction activity in the U.S. dropped for a seventh consecutive month as spending on both residential and commercial projects fell which signals persistent troubles in construction will continue to affect the overall economic recovery.
The Commerce Department, in a report, said Monday that US construction spending fell 0.6 percent in November indicating a bigger drop than the 0.4 percent decline economists had been expecting.
The declines in spending were widespread and the largest amount since June and non-residential building declining for an eighth straight month.
The 0.6 percent decline in construction activity in November followed a 0.5 percent drop in October which was revised downward from an original estimate showing a much smaller dip. The seven consecutive drops pushed construction spending further down to a seasonally adjusted annual rate of $900.1 billion, the slowest pace in more than six years and down 13.2 percent compared to the level of activity a year ago.
Private residential activity fell by 1.6 percent in November to an annual rate of $250.7 billion after a big 4.8 percent surge in October. The increase can be attributed to builders trying to finish projects before the original November expiration for a popular home buyers tax credit, a tax break which has been extended and expanded by Congress.
Commercial projects spending from office buildings to factories and shopping centers dropped 0.03 percent, the eighth straight drop.
Government projects spending dropped 0.4 percent to a rate of $318.8 billion as spending on federal construction projects increased by 1.1 percent in November.