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February 2014 Economic News Roundup
This Month in Numbers...

56 - The NAHB homebuilder confidence index reported a score of 56 in January, a one-point decline from the downwardly revised score of 57 in December. "Following an unexpected jump last month, builder confidence has essentially leveled out and is holding at a solid level," said NAHB chairman Rick Judson. Index scores above 50 indicate builder perceptions of the market are more positive than negative.

11.4% - December was a month of declines for construction employment. The industry workforce fell by 16,000 in the last month of 2013, and the unemployment rate fell to 11.4 percent, down from 13.5 percent in December 2012. Construction employment totaled 5,833,000 in December, an increase of 122,000 jobs from a year earlier. Despite a 2.1 percent increase to the workforce in 2013, the sum of industry jobs remains nearly 1.9 million below the sector's April 2006 peak.

86 - The NAHB's Leading Markets Index, which measures economic and housing growth in metropolitan areas nationwide, added two markets in January but maintained December's overall reading of .86, meaning that the overall housing market is running at just 86 percent of normal activity levels. Smaller metros lead the index in states boosted by energy-related growth, such as Wyoming, North Dakota and Texas.

New Residential Construction, December
Residential construction activity declined in all categories in December, falling from upwardly revised surges in November that briefly pushed housing start and building permit rates over a one million-unit annual pace. Building permits were just 4.6 percent higher than December 2012 levels, and housing starts were up 1.6 percent year-over-year.

999,000 - annual rate, new housing starts, seasonally adjusted (SA)
-9.8% - housing starts rate change since November 2013 (SA)
2.27 - housing starts annual rate peak (millions), January 2006

986,000 - annual rate, new building permits (SA)
-3.0% - building permits rate change since November 2013 (SA)
2.26 - building permits annual rate peak (millions), September 2005

Home Remodeling Growth Likely in Early 2014
Credit: Joint Center for Housing Studies of Harvard University

A housing study from Harvard University predicts double-digit gains in home improvement spending in the first half of 2014. Owners gaining confidence in the housing market are likely to take on remodeling projects they have been putting off, encouraged by growth in housing starts, home prices and existing home sales.

Cement Group Predicts Growth in 2014

The Portland Cement Association (PCA) expects 2013 cement consumption to total nearly 80 million metric tons, a 4.5 percent increase over 2012. Consumption levels are projected to reach 86 million metric tons in 2014, an 8.1 percent year-over-year gain. Roughly half of the growth anticipated for 2014 is expected to come from residential construction activity, where pent-up demand has driven home prices upward over the past year. The commercial and institutional sector will contribute another 25 percent, and the remainder is expected to come from public infrastructure projects. PCA group vice president and chief economist Edward Sullivan believes that roadway construction reached a "trough point" in 2013, and "improving state finances could provide surpluses by 2015 that states can apply to neglected infrastructure spending."

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