Nightmarish Week in Review
Construction spending, workplace injuries, & more
Our long national nightmare appears to be coming to an end. No, not the nightmare that has sent oil surging to several-year highs. That one is ongoing and just as scary as ever, with gas prices up $1.00/gallon from just four weeks ago.
The other nightmare. The one that caused the longest TSA wait times in history. Early this morning, the Senate approved funds to pay most Homeland Security agencies. Assuming the House does its part, this could all be wrapped up later today.
This week was light on economic data releases but still brought us updates on construction spending, workplace injuries and illnesses, and more.
Monday
Construction Spending
Construction spending fell 0.3% in January, but that decline was at least partially due to bad weather.
Taking the optimist’s view, spending is up about 2% from the May 2025 cyclical low and has increased in 5 of the past 8 months.
Is that encouraging? Sure, but the recent rebound is almost entirely due to increasing residential renovation work, which has risen by $53 billion (seasonally adjusted annual rate) since May. All other construction spending is down by about $12 billion over that span.
To put this into context, we’re spending about 770% more on residential renovations than we are on data centers. Residential renovations now account for $1 in every $4 of private construction activity.
Just focusing on the nonresidential side of the industry, spending fell in January, and private nonresidential is particularly weak, down 3.0% year over year.
And that’s before we see what kind of pain soaring oil prices cause for the industry. Not great!
Oil Stuff
Gas prices shot up to $4.10/gallon for the week ending March 23rd. That’s up more than $1.00/gallon from late February.
Diesel prices—what you should really lose sleep over—continue to surge and are now up to $5.38/gallon. That’s going to put upward pressure on a lot of other prices.
Despite the massive increase in prices, domestic oil production hasn’t risen and is actually slightly lower than in February.
Oil prices continued to rise through this morning, so no imminent relief in sight.
Tuesday
TSA Checkpoint Travel Numbers
Air travel has held up better than I would have guessed in the face of the TSA wait time craziness, with passenger volumes still up on a year-ago basis. Even with the end of this TSA funding standoff in sight, the prospect of rapidly rising fuel costs suggests ongoing turbulence for air travel.
