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Construction Industry

AP
Mon, February 01, 2010

WASHINGTON — Construction spending dropped sharply in December to its lowest level in more than six years as new home building fell by the steepest amount in seven months, evidence that housing remains a weak spot in the economy.

The Commerce Department says spending on new homes, office buildings and highways fell by 1.2 percent, much worse than analysts' expectations of a 0.5 percent drop.

November's figures were revised down to also show a 1.2 percent decline, below the 0.6 percent drop initially reported.

Construction spending on new homes and apartments fell by 2.8 percent, the biggest drop since May 2009. Spending on new office buildings and other non-residential projects rose by 0.2 percent after falling for seven straight months.

Housing starts had fallen 4 percent in December held back by unusually cold weather.

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