Construction starts rebound in October
Total construction starts rose 12% in October to a seasonally adjusted annual rate of $787.9 billon. While sizeable, the increase does not erase September’s substantial pullback in starts. All three major categories moved higher over the month, nonbuilding starts rose 25%, nonresidential buildings increased 19%, while residential activity gained 2%. “October’s gain was welcome news following the large step back in starts during the previous month,” stated Richard Branch, Chief Economist for Dodge Data & Analytics. “The month’s increase, however, does not mean all is well with the economy and construction sector. The economy lost traction as the stimulus provided by the CARES Act ended. With the next wave of COVID-19 infections looming, the economy will continue to lose steam until more fiscal stimulus is provided and a vaccine has been widely adopted. Until that has occurred, the construction sector will continue to be volatile.”
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