Contracting for new construction advanced for the second consecutive month as projects totaling $13.5 billion were started in July, the F. W. Dodge division of McGraw-Hill Information Systems Company reports.
The seasonally adjusted Dodge index, which indicates the level of expenditures for construction that will be brought to completion in future months, advanced 2 percent in July. July's small increase followed a 16 percent jump in June.
July's contracting statistics were encouraging, since they reinforced June's tenuous upturn in the flow of new products. Until June, the construction business had been in a steep downward spiral.
Contracting for residential building has strengthened significantly since May as a result of recent easing of credit. The value of July housing starts advanced to a seasonally adjusted rate nearly 40 percent higher than the cyclical low point reached during April and May. Two months of recovery, however, still left July's total of residential building 11 percent below the comparable 1979 value.
Contracting for nonresidential buildings, which reached its peak in January, retreated nearly 20 percent by July as the 1980 recession took its toll. Despite this decline, the latest month's nonresidential contract value remained 6 percent higher than a year ago, however.