Construction Spending, Jobs, & More

Week in Review: Jan. 1-5

Economic forecasting is hard. Who could have known six months ago that piracy in the Red Sea would cause container shipping rates to virtually double during the first week of January?

Sure, your forecast accounted for excess savings, inventories, interest rates, demographics, and maybe even the fact that it’s an election year, but you forgot about the possibility that literal pirates would disrupt global supply chains. Whoops.

Pirates aside (or maybe included), we’ll get around to making predictions for 2024 and grading our predictions for 2023 over the next few weeks. For now, it’s about reviewing a week that included new data on construction spending, job openings, hiring, and more.

(You can read our full post on the December jobs report from earlier today here).

Monday

Gas Prices

Gas prices fell to start the year and, at $3.21/gallon, are cheaper than at any point in 2023. This is the 14^th straight weekly decline and is a great way to start the year.

Diesel Prices

Diesel prices also fell during the week ending January 1^st. At $3.87/gallon, diesel prices are at the lowest level since the middle of 2023.

TSA Checkpoint Travel Numbers

The number of passengers screened by TSA on the first two days of the year is up 5.6% compared to 2023. Air travel really surged in November and fell off a bit in December. This will be something to keep an eye on in early 2024.

Tuesday

Construction Spending

Construction spending inched higher in November and is up a healthy 11% year over year. Nonresidential spending has increased 18% over the past year, while residential spending is up just 4%. These numbers aren’t adjusted for inflation, but even including price increases, it’s been a surprisingly strong year for construction activity.

That has a lot to do with the ongoing rise manufacturing-related construction spending, which is now up 165% since the start of 2020. To put the recent surge in megaprojects in context, manufacturing accounted for greater than one in every ten dollars spent on construction in November.

A few other segments have posted strong years, including infrastructure-related ones like sewage and waste disposal, highway and street, and water supply.

You can read what Anirban had to say about this release over at Associated Builders and Contractors.

Wednesday

Piracy and Global Freight Rates