Tag Archive for 'ABC'

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ABC Celebrates Supreme Court’s Recess Appointment Ruling

image007Associated Builders and Contractors (ABC) today celebrated the Supreme Court’s decision in National Labor Relations Board v. Noel Canning that President Obama unconstitutionally bypassed the U. S. Senate by appointing Sharon Block, Richard Griffin and Terrence Flynn to fill National Labor Relations Board (NLRB) vacancies.

“By upholding the U.S. Court of Appeals’ decision, the Supreme Court has reaffirmed the Senate’s role in the executive appointment process,” said ABC Vice President of Government Affairs Geoff Burr. “Today’s ruling overturning President Obama’s illegal recess appointments to the NLRB is a victory for ABC, the Constitution and our system of checks and balances, and it serves as a clear rejection of the president’s unprecedented expansion of executive authority.

The original case was brought by Noel Canning, a Washington state bottling company, which challenged an NLRB decision that it must enter into a collective bargaining agreement with a labor union. The ABC-led Coalition for a Democratic Workplace intervened in the case and, last January, the U.S. Court of Appeals for the D.C. Circuit ruled that the president violated the Constitution when he bypassed the Senate to fill NLRB vacancies.

In addition to reaffirming the legislative branch’s role in the presidential appointee confirmation process, today’s Supreme Court ruling jeopardizes the legal status of more than 1,000 Board actions over the past two years.

ABC Reports: Construction Materials Prices Flat in May

CEU2“Materials prices have been remarkably stable, which fits neatly into the context of soft expansions in both domestic and global construction volume.” —ABC Chief Economist Anirban Basu.

PPI_6 13 14Overall construction materials prices remained flat in May but are up 1.6 percent year over year according to the June 13 Producer Price Index release supplied by the U.S. Department of Labor. Nonresidential construction materials prices fell 0.2 percent for the month but are 1.3 percent higher than at the same time one year ago.

“With construction spending expanding only in fits and starts and given recent evidence of disappointing global economic performance, it comes as little surprise that most construction materials prices are not rising,” said Associated Builders and Contractors Chief Economist Anirban Basu. “For the better part of two years, materials prices have been remarkably stable, which fits neatly into the context of soft expansions in both domestic and global construction volume.”

Crude energy materials prices expanded 2.7 percent in May and are 4.8 percent higher than one year ago. Natural gas prices expanded by 3.4 percent in May after declining significantly during the previous two months. Overall, the nation’s wholesale goods prices remained flat in May and have increased 2.5 percent year-over-year.

“However, the future could be markedly different with the worrisome situation in Iraq causing oil prices to rise,” said Basu. “This price dynamic can impact the prices of other materials, which means that materials price inflation may ensue even in the absence of a meaningful pickup in nonresidential construction activity. The impact of revelations regarding the metal financing scandal in China may also cause materials to become more volatile, but in that case, the impact may actually be to suppress future price increases.”

The following materials prices increased in May.

Crude petroleum prices increased 3.2 percent in May and are up 3.7 percent from May 2013.

Nonferrous wire and cable prices gained 0.5 percent on a monthly basis but are down 2.1 percent from May 2013.

Natural gas prices expanded by 3.4 percent in May and are 13.2 percent higher than one year ago.

Crude energy materials prices expanded by 2.7 percent in May and are 4.8 percent higher year over year.

Seven of the 11 key construction inputs did not experience price increases for the month.

Prices for prepared asphalt, tar roofing, and siding declined 2.1 percent for the month and are down 5.8 percent from the same time last year.

Softwood lumber prices fell 0.2 percent in May and are 0.3 percent lower than one year ago.

Prices for plumbing fixtures remained flat for the month and are up 2 percent on a year-over-year basis.

Fabricated structural metal product prices remained flat for the month and have risen 1.1 percent on a year-over-year basis.

Concrete products prices fell 0.1 percent in May but have increased 3.4 percent from the same time last year.

Iron and steel prices declined 1 percent in May but are up 4.3 percent from the same time last year.

Steel mill products prices fell 0.1 percent for the month but are 3.4 percent higher than one year ago.

To view the previous PPI report, click HERE.

ABC Reports: Nonresidential Construction Employment Declines In May

CEU2“Coming into today’s release, the nonresidential construction industry was expected to have added jobs in May; instead, 500 jobs were lost.” —ABC Chief Economist Anirban Basu.

Employment_6.6The U.S. construction industry only gained 6,000 jobs in May, according to the June 6 employment report by the U.S. Department of Labor (DOL). Nonresidential construction segments lost 500 jobs in May, a surprising departure from the 12,600 jobs (revised) added in April. The residential sector performed slightly better, adding 3,300 jobs for the month. The heavy and civil engineering sector added 3,200 jobs in May and has added an impressive 32,600 jobs in the past 12 months.

“Coming into today’s release, the nonresidential construction industry was expected to have added jobs in May; instead, 500 jobs were lost,” said Associated Builders and Contractors Chief Economist Anirban Basu. “While the nation added almost precisely the number of jobs collectively anticipated by economists, the jobs lost in the nonresidential construction segments, including 400 jobs among specialty trade contractors, came as a surprise.

“Today’s disappointing jobs report follows months of tepid growth in construction spending,” said Basu. “Public construction expenditures remain incredibly constrained and private nonresidential construction spending declined in April, a reflection of an economy that actually shrank during the year’s initial months.”

The national construction unemployment rate fell to 8.6 percent on a non-seasonally adjusted basis in May. “The fact that the construction unemployment rate fell despite the segment adding only 6,000 jobs may be an indication of the skilled labor shortage; however, expect the rate to stay more or less unchanged over the coming months,” said Basu.

According to the Bureau of Labor Statistics’ household survey, the national unemployment rate remained unchanged at 6.3 percent in May, remaining at its lowest level since September 2008. The civilian labor force expanded by 192,000 people in May, though it still has 614,000 fewer people than in May 2014.

Nonresidential building construction employment fell by 100 jobs for the month, but is up by 19,600 jobs (2.9 percent) since May 2013.

Residential building construction employment rose by 100 jobs in May and is up by 47,000 jobs (7.7 percent) on an annual basis.

Nonresidential specialty trade contractors lost 400 jobs for the month, but employment in that category is up by 29.8 jobs (1.4 percent) compared to the same time last year.

Residential specialty trade contractors gained 3,200 jobs in May and have added 58,600 jobs (3.8 percent) since May 2013.

The heavy and civil engineering construction segment gained 3,200 jobs in May and job totals are up by 32,600 (3.7 percent) on a year-over-year basis.

To view the previous Employment report, click here

ABC Reports: Nonresidential Construction Spending Expands in April

CEU2“The year-over-year advance of 3.9 percent seems to realistically capture the rate of improvement in nonresidential construction spending.”—ABC Chief Economist Anirban Basu.

Spending 6 2Nonresidential construction spending inched up in April according to the June 2 release by the U.S. Census Bureau. This is the second consecutive month spending has increased following March’s upwardly revised spending report. Nonresidential construction spending expanded by 0.4 percent on a monthly basis in April and has risen 3.9 percent on a year-over-year basis. Spending for the month totaled $570.6 billion on a seasonally adjusted, annualized basis.

“Unsurprisingly, nonresidential construction spending has improved with the weather,” said Associated Builders and Contractors Chief Economist Anirban Basu. “As a result of the unusually harsh winter weather, spending declines appeared large during the winter months and subsequent monthly gains have perhaps been a bit exaggerated as well. While the monthly numbers may be skewed, the year-over-year advance of 3.9 percent seems to realistically capture the rate of improvement in nonresidential construction spending.”

“The U.S. economy has recovered its momentum since the first quarter, suggesting that nonresidential construction’s steady recovery will remain in place,” said Basu. “Indeed, measures of business confidence have improved significantly and there are indications that capital spending is set to accelerate.”

Ten of 16 nonresidential construction subsectors posted increases in spending in April.

•Lodging construction spending is up 1.9 percent on a monthly basis and is up 16.9 percent on a year-over-year basis.

•Office-related construction spending grew by 1.7 percent in April and is up 20 percent from the same time one year ago.

•Construction spending in the transportation category expanded 3.4 percent on a monthly basis and has expanded 8 percent on an annual basis.

•Religious spending grew 1.8 percent for the month but is down 5.9 percent from the same time last year.

•Education-related construction spending gained 2.7 percent for the month and is up 2.9 percent on a year-over-year basis./p>

•Commercial construction spending rose 1.2 percent in April and is up 5.9 percent on a year-over-year basis.

•Sewage and waste disposal-related construction spending gained 4 percent for the month but has fallen 5.5 percent from the same time last year.

•Amusement and recreation-related construction spending expanded 4.4 percent on a monthly basis and is up 3.2 percent from the same time last year.

•Health care-related construction spending grew 0.9 percent for the month, but is down 6.2 percent on a year-over-year basis.

•Conservation and development-related construction spending expanded by 3.6 percent for the month and is up 19.7 percent on an annual basis.

Spending in six nonresidential construction subsectors declined in April.

•Spending in the water supply category fell 0.2 percent on the month and is down 12.8 percent from the same time last year.

•Manufacturing-related spending fell 1.1 percent on a monthly basis, but is up 6.7 percent on an annual basis.

•Highway and street-related construction spending fell 1.1 percent in April, but is up 4.8 percent compared to the same time last year.

•Communication construction spending was down 11.7 percent for the month but is up 21 percent from the same time one year ago.

•Public safety-related construction spending fell 0.9 percent on a monthly basis and has declined 12.4 percent on a year-over-year basis.

•Power construction spending dipped 1.2 percent for the month and was 1.6 percent lower than the same time one year prior.

To view the previous Spending report, click here

ABC Reports: Nonresidential Construction Backlog Slides in Icy First Quarter

ABC Harsh winter weather helped produce a 2.8 percent decline in Associated Builders and Contractors’ (ABC) Construction Backlog Indicator (CBI) during 2014’s first quarter. The weather also impacted construction starts, architectural billings and many other construction-related metrics. Overall, CBI now stands at 8.1 months—down from the 8.3 months in the previous quarter, but up from 7.9 months a year ago.

“Despite a decline in overall backlog, only one of three industry segments, commercial/institutional, saw a decrease in backlog during the first quarter,” said ABC Chief Economist Anirban Basu. “Retailers and other commercial actors have been seeking to build cash reserves rather than to expand operational capacity, which helps explain the decline. However, second quarter business spending appears to be on the rise. Many companies are flush with cash and small business confidence is improving, which means commercial backlog is expected to expand during 2014’s second quarter and likely beyond.

“Regionally, the West, which features many of the states hardest hit by recession, including Arizona, California and Nevada, was the only region to experience expanding backlog,” said Basu. “The South, which includes rapidly growing states like Texas and Florida, continues to post the lengthiest average backlog, while the Middle States region, which includes communities with highly constrained public budgets like Chicago and Detroit, has the shortest construction backlog.

“Firms in three of the four size categories experienced an increase in average contractor backlog,” said Basu. “Larger firms, which generally have the greatest access to capital and therefore are more likely to be able to take on projects, continue to enjoy the lengthiest backlog. Backlog among smaller firms is roughly where it was at the end of 2011, leading many of those firms to offer bids with low profit margins in an attempt to line up additional work.

“Nonresidential construction economic indicators have not been particularly strong thus far in 2014,” said Basu. “After rising only sporadically in 2013, overall nonresidential construction spending fell for the fourth consecutive month in March.  However, the first quarter’s bitter weather likely pushed additional construction into subsequent periods, suggesting that construction spending and CBI are poised to expand during ensuing quarters.”

Regional Highlights

  • Average backlog declined in three of four regions during the first quarter.
  • While the South experienced the sharpest downturn in backlog, it also continues to boast the lengthiest backlog of all four major regions.
  • The West posted the largest gain in average contractor backlog on both a quarterly and year-over-year basis largely because California, Arizona, Nevada, Washington state and Oregon are among the most rapidly recovering states.

Industry Highlights

  • Despite a decline in overall backlog, only one of three industry segments, commercial/institutional, saw a decrease in backlog during the first quarter.
  • Backlog in the infrastructure segment ended a three-quarter losing streak and is now approaching 8 months.
  • Although backlog in the heavy industrial segment is rising, the reading for this segment remains the lowest of the three segments; however, manufacturing capacity utilization has been rising recently, implying that heavy industrial backlog is likely to expand more rapidly during the next several quarters.

Highlights by Company Size

  • Larger firms with annual revenues above $100 million continue to report the lengthiest backlog at 11.7 months–the second largest reading this category has seen.
  • Firms with $50 million to $100 million in annual revenue are the second most successful in terms of contracted work, with backlog at 10.69 months, although their average backlog is down from 11.52 months last quarter.
  • Smaller firms experienced a half-month decline in backlog during the first quarter but still enjoy a higher backlog than a year ago at 7.16 months.

To read more about the latest CBI, click here.