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Wright Express Releases Monthly Construction Fuel Consumption Index (FCI) Results
U.S. Construction Industry Fueling Up 5.1% Year-Over-Year in May; Up 4.5% versus Previous Month
The Wright Express Construction FCI measures national fuel consumption
statistics for the construction industry, which provides an accurate and
up-to-date indication of construction activity in
The indicators were tested at monthly, quarterly, and annual
frequencies, with the greatest insights produced using the
year-over-year percent change of the monthly data. For
The Wright Express Construction FCI, which is available monthly in
advance of the
Last month’s Wright Express Construction FCI accurately captured the weakness evident in many of the government’s subsequent construction data releases. Construction spending excluding improvements – a good measure of activity – declined 0.2% in April. Private nonresidential spending decreased by 0.2%, although private residential construction excluding improvements rose 2.1%. Total construction put-in-place increased by 0.3% in April.
According to the IHS analysis, the up-and-down nature of the Wright Express Construction FCI in recent months suggests that the industry’s recovery is still somewhat fragile. After three years of depressed construction, the inventory of new housing is beginning to tighten. New home sales rose 3.3% in April, and estimates for the previous three months were revised upward. The new home sales market is unquestionably improving, although activity is still less than half of normal. Inventory continues to shrink, which is good news since builders will have to replenish stocks by ramping up starts once demand rebounds.
Meanwhile, to echo last month’s report, getting rid of the excess housing supply could be a drawn-out affair. The homeowner vacancy rate measuring the proportion of homes that are vacant and for sale was 2.3% at the end of 2011. This vacancy rate is consistent with a glut of about one half of a million houses. At the current pace, eliminating the overhang should take less than two years, but will probably take longer, because it is concentrated in a few high-unemployment states.
The Wright Express Construction FCI for
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News media contact:
Wright Express Corporation
Jessica Roy, 207-523-6763