WASHINGTON (AP) ? Builders cut back on spending by the largest amount in six months in July with sharp reductions in spending on government building projects.
The Commerce Department says construction spending fell 1.3 percent to a seasonally adjusted annual rate of $789.5 billion. That is 3.5 percent above an 11-year low hit in March but it is still only about half the $1.5 trillion that economists view as a healthy level for construction. Economists believe it could take four years before construction activity returns to more normal levels.
The weakness in July reflected a 2.1 percent drop in spending on government building projects, which fell to the slowest pace since late 2006. Spending on residential construction was down 1.4 percent,