U.S. Construction Spending Falls; Employment Drops for the First Time Since 2003
- Feb 01, 2008
Washington, D.C.–U.S. employment fell unexpectedly in January for the first time in more than four years, prompting a new wave of concern that the economy would slide into a recession, according to data released Friday by the Labor Department.However, a small decline in unemployment and a positive revision to December payroll growth may indicate some hope for the troubled U.S. economy, The Wall Street Journal reports.Nonfarm payrolls dropped 17,000 in January, the first decrease since August 2003. Gains in the health care, retail trade and leisure industries made up for declines in the manufacturing, construction, financial services and government sectors.Revised December payrolls showed an increase of 82,000; but November job growth was adjusted downward–by almost half–to 60,000. The unemployment rate, as forecast, dropped from 5 to 4.9 percent.The Commerce Department also said Friday that construction spending declined. Total spending fell by 1.1 percent at a seasonally adjusted annual rate of $1.140 trillion. On an unadjusted basis, construction spending in 2007 dropped 2.6 percent–after rising 5.3 percent the year before and 10.6 percent in 2005.November construction spending declined at a seasonally adjusted annual rate of 0.4 percent; prior government speculation indicated spending increased 0.1 percent in November.Residential construction spending in December fell 2.7 percent to $469.1 billion and decreased by 3.0 percent in November. Compared to 2006, residential spending was 20.1 percent lower in December.