SMU Analysis: CPIP Data Shows Construction Losing Momentum

Due to the government shutdown, this our first construction update since the October data was released on Dec. 3. The Construction Put in Place (CPIP) expenditures data for November through January was released on March 13. The results for total construction were disappointing with slowing growth in November, December and January. This was not a seasonal effect, as we report only on a rolling three-months basis year over year, which smooths the seasonality.

At SMU, we analyze the CPIP data with the intent to provide a clear description of activity that accounts for about 45 percent of total U.S. steel consumption. See the end of this report for more detail on how we perform this analysis and structure the data. In particular, note that we present non-seasonally adjusted numbers and we don’t include expenditures for residential improvements. Our rationale is that construction is highly seasonal and our businesses function in a seasonal world, and home improvements don’t consume much steel. The growth or contraction that we report in this analysis has had seasonality removed by providing only year-over-year comparisons. For these reasons, our results may not align with other sources.