Construction spending advanced 2.2 per cent in April to a seasonally adjusted annual rate of $1 trillion, the highest level since November 2008, the Commerce Department said Monday. Spending had risen a more modest 0.5 per cent in March.
The gain included a 0.6 per cent rise in residential construction and a 3.1 per cent jump in non-residential activity such as office buildings, hotels and shopping centres. Government projects increased 3.3 per cent, reflecting the biggest jump in spending on state and local projects in three years.
Economists are looking for construction to provide solid support to the economy this year.
The April advance was the biggest one-month gain in three years and left construction activity more than 4 per cent above where it was a year ago.
The construction industry has struggled to come back from the Great Recession, which hit builders hard.
The April expansion in home building followed two lacklustre months. Both single-family homes and apartment building showed gains in April.
The increase in spending on government projects reflected a strong 3.9 per cent jump in state and local projects, the biggest monthly increase since April 2013. That strength offset a 3.6 per cent decline in federal spending.
The construction industry appears to be emerging from a soft patch in recent months when activity was curtailed by an unusually severe winter in many parts of the country.
The government reported last week that the overall economy, as measured by the gross domestic product, shrank at an annual rate of 0.7 per cent in the January-March quarter. Economists are forecasting a rebound to growth of around 2.5 per cent in the current April-June quarter.