Construction spending fell 0.5 percent in December, its ninth consecutive decline. This helped limit outlays for the year to a meager 0.6 percent gain, the government said Friday.
The Commerce Department said residential, non-residential and government construction spending totaled a seasonally adjusted annual rate of $415.1 billion, the lowest level since a $410.5 billion posting in January 1988.The drop followed revised declines of 1.5 percent in November, even worse than the 0.6 percent decrease originally reported, and 0.1 percent in October. The department first said October spending had risen 0.3 percent.
For the year, spending totaled $434.9 billion, up from $432.1 billion in 1989.
But construction has been consistently on the skids since posting a 0.4 percent gain last March, wracked by tight credit, high vacancy rates and faltering consumer confidence because of the Persian Gulf crisis and a recessionary economy.
As a result, 28,000 construction jobs were lost in December, according to Labor Department statistics. And as a portent of things to come, it said Friday the construction industry lost an additional 155,000 jobs, after seasonal adjustment, in January.
Spending on residential buildings continued a two-year decline, falling 2.3 percent in December to an annual rate of $167.5 billion following a 3.2 percent decline a month earlier.