Shrinking Health Construction Spending Confirmed in Public Sector
Yesterday’s release of construction spending from the U.S. Census Bureau confirms that spending on health facilities is shrinking, as I noted in my entry on last month’s construction report. Total construction spending amounted to about $1 trillion (annualized) in June, of which $40 billion was health care. Health construction spending shrank 0.9 percent from May and grew only 6.3 percent year on year, just over half the rate of growth of all other construction spending. (See Table I.)
Separating the data into private and public spending, health construction spending shrank twice as fast as other private construction spending in June. However, private spending on health care construction has kept pace, year on year, with other private construction spending. It is in the public ledger where health construction has collapsed, year on year, by over nine percent. Other public construction spending is growing significantly, year on year.
So it looks like the story is a little different than what was described last month. America’s private hospitals (which are mostly non-profit) continue to stuff their surplus earnings into capital construction.
