• Commercial Projects Boost Construction Starts, Jobless Claims Decline

    Commercial Projects Boost Construction Starts

    Ground-breakings for nonresidential construction projects are outpacing residential starts as housing market sales slow and mortgage rates rise.

    Data firm Dodge Construction Network reported Thursday that the nonresidential category, which includes most types of commercial projects, saw the value of newly started projects rise 9% from the prior month to about $480.5 billion, while residential construction starts declined 3% to $366.4 billion. For the first 10 months of 2022, nonresidential projects were up 37% in value from a year earlier, while residential projects were essentially flat with 2021.

    “October’s gain in construction starts is a further sign that the construction sector continues to weather the storm of higher interest rates,” Dodge Construction Chief Economist Richard Branch said in a statement. “While the residential sector is feeling the pain, the nonresidential building and infrastructure sectors are hitting their stride.”

    Dodge researchers noted commercial project starts rose 19% from the prior month in October, led by office and hotel projects. Commercial starts were up 23% from year-earlier levels for the first 10 months of 2022, with manufacturing-related projects rising 157%.

    The nation’s largest nonresidential projects breaking ground in October included a $3.2 billion Texas Instruments chip fabrication plant in Sherman, Texas, a $2 billion General Motors electric vehicle plant in Orion Township, Michigan, and a $1 billion net-zero hydrocarbon plant being built by biofuels maker Gevo in Lake Preston, South Dakota, Dodge reported.

    Jobless Claims Decline

    Initial claims for unemployment insurance declined 4,000 from the prior week and totaled 222,000 for the week ended Nov. 12, the Labor Department reported Thursday. The four-week moving average increased 2,000 from the prior week, reaching 221,000 and maintaining a trend of historically low numbers with the national unemployment rate at 3.7%.

    Thousands of planned layoffs announced in the past month, particularly in the technology industry, have not yet manifested nationally in significantly higher claims. The Labor Department said the total of continued weeks’ claims in all programs, tracked on a more delayed basis, was approximately 1.3 million for the week ended Oct. 29 – up 24,305 from the previous week but still well below the 2.6 million for the comparable week of 2021.

    Also Thursday, the Labor Department said September growth rates for job openings increased from the prior month in eight states but remained little changed in the remaining 42 and the District of Columbia. The largest percentage gains for growth rates for September were recorded in Michigan and New Hampshire, each rising 1.1%.

    Hiring declined in nine states, rose in two and was little changed in 39 states and the District of Columbia. New Hampshire led in hiring growth at 1%, followed by Arizona at 0.8%. The U.S. rates for job and hiring growth in September were both flat with August.

    Source: www.CoStar.com