LOS ANGELES The value of U.S. construction starts declined 11 percent in November from the previous month, led by a drop in nonresidential building.
The value of starts in November declined to a seasonally adjusted annual rate of $524.8 billion from $591.1 billion in October, offset only partially by a 1-percent rise in residential construction to $218.5 billion, according to the McGraw Hill Construction division of McGraw Hill Financial Inc., New York.
Meanwhile, the value of total construction starts through November 2013 rose 6 percent on an unadjusted basis to $475.3 billion vs. $446.8 billion in the same 2012 period, led by a 25-percent jump in residential building and an 8-percent increase in nonresidential building.
Nonresidential building fell 17 percent in November vs. the prior month to an annual rate of $179.3 billion, led by an 86-percent plunge in manufacturing due to fewer major new projects.
Nevertheless, there was a bright spot in nonresidential data, as commercial construction, a significant consumer of structural steel, increased 31 percent, with hotel construction surging 212 percent and office construction up 26 percent. Without the decline in manufacturing, nonresidential building would have registered a 16-percent increase in November.
Nonbuilding construction fell 21 percent month on month in November, largely due to a 73-percent decrease in bridge construction.
Despite Novembers decline from the "heightened activity" of September and October, the construction outlook remains positive, McGraw Hill Construction chief economist Robert Murray said. "For 2014, the upward trend for construction starts is expected to continue."
While nonbuilding construction fell 15 percent in the first 11 months of 2013, this was due largely to a 59-percent drop in electric utility starts offset by 5-percent year on year growth in public works.