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Construction spending rose $1.2 billion (+0.1%) in July to a seasonally adjusted annual rate (SAAR) of $1,315.4 billion following a $3 billion downward revision to construction spending in June. Private construction dropped -0.1% to a SAAR of $1,010.9 billion with a -1.0% drop bringing nonresidential construction to $450.9 billion and offsetting a +0.6% gain that raised residential spending to $560.1 billion. Public construction increased to a SAAR of $304.5 billion (+0.7%), with gains in construction for education ($71.6 billion, +2.1%) and highways ($94.2 billion, +0.4%). On a yearly basis, public construction spending increased the most for water supplies (+29.7%), conservation (+24.1%), office (+23.7%) and commercial (+23.7%) structures, while private construction spending increased the most for transportation (+21.5%). Yearly spending dropped for private construction of religious structures (-14.7%), manufacturing (-4.4%), and health care (-1.9%).
Last week’s advance estimate of the goods trade deficit was revised to trim July’s drop in exports from -$2.5 billion to -$2.3 billion, but left the increase in imports unchanged at +$1.8 billion, widening the goods trade deficit by $4.1 billion to $73.1 billion. Service exports increased by $0.2 billion, but were outpaced by a service imports increase of +0.3 billion, resulting in a narrowing of the services surplus to $23.1 billion. The overall trade deficit grew +9.5% to $50.1 billion and brought the deficit for the year to date up to $337.9 billion, up $22.0 billion (+7.0%) from the same period in 2017. Export drops included civilian aircraft (-$1.568 billion), soybeans (-$682 million), fuel oil (-$413 million), and iron/steel mill products (-$200 million), while export increases included liquified natural gas (+$411 million), other petroleum products (+$277 million), and passenger cars (+253 million). Import drops included pharmaceuticals (-$1.3 billion) and passenger cars (-$232 million), and increases included computers (+$467 million) and trucks (+$469 million).
There were 201,000 jobs created in August, leaving the unemployment rate unchanged at 3.9% and ticking down the total number of unemployed to 6.234 million (-46,000 M/M, -893,000 Y/Y). The number of long-term unemployed (i.e. unemployed for more than 27 weeks) is 1.332 million (-103,000 M/M, -403,000 Y/Y), and the more comprehensive U-6 unemployment rate, which includes underemployed and discouraged workers, ticked downward by -0.1% to 7.4% (-1.2% Y/Y). Jobs were added in professional services (+53,000), health care (+33,000), and construction (+23,000), while manufacturing lost 3,000 jobs. The average workweek was unchanged at 34.5 hours/week, although manufacturing jobs averaged 41.0 hours/week with 3.5 hours of overtime. Hourly wages were up $0.10 / hour (+0.4%) to $27.16/hour (+0.2%), and the year over year gain in wages was +2.9%, the highest rate since 2009.
Wednesday September 12 – Producer Price Index – Final Demand (PPI-FD)
Friday September 14 – Retail Sales