LOS ANGELES U.S. construction starts moved up in August, but one sector considered crucial to steel consumptionnonresidential constructionfell.
Starts last month rose 2 percent over July to a seasonally adjusted annual rate of $490.2 billion, according to McGraw Hill Construction, a division of McGraw Hill Financial Inc., New York.
Residential building activity rose 4 percent in August while nonbuilding constructionwhich includes public works and electric utilitiesreversed a July downturn with an 11-percent surge, McGraw Hill said.
But nonresidential construction, which is critical to structural sections, plate and structural pipe and tubing, fell 8 percent in August to an annual rate of $148 billion after rising 9 percent in July.
"A more solid expansion for total construction requires a greater contribution from nonresidential building, which has yet to occur," Robert Murray, McGraw Hill Constructions vice president of economic affairs, said in a statement.
One service center executive said that while his company hasnt yet seen a sustained improvement in its eastern nonresidential construction markets, he sees "money on the sidelines" eager to finance new projects. But political deadlock in Washington is undermining the stable outlook thats necessary before those projects get the green light, he said.