Construction sets foundation for modest GDP | | MacroBusiness

The ABS released Construction Work Done for the September quarter this morning, which is a key driver of Australia?s business investment led GDP. Here are the key figures:

SEPTEMBER KEY FIGURES

		Sep qtr 12	Jun qtr 12 to Sep qtr 12	Sep qtr 11 to Sep qtr 12
		$m	% change	% change
Value of work done
	Building	19 332.7	-0.9	-3.3
	Residential	11 147.5	-0.9	-5.0
	Non-residential	8 188.2	-0.8	-0.9
	Engineering	32 241.6	4.4	22.4
	Total construction	51 681.8	2.6	11.6
SEASONALLY ADJUSTED ESTIMATES(a)
Value of work done
	Building	19 257.9	-1.6	-4.9
	Residential	11 221.9	0.6	-3.7
	Non-residential	8 036.0	-4.5	-6.4
	Engineering	32 040.1	3.8	13.9
	Total construction	51 298.0	1.7	6.0

No real surprises here. The mining boom continues to power with engineering work done up 3.8% in the quarter and 13.9% year on year. Until recently, this was being offset by declines in residential and other construction, but this release shows some improvement in residential, although still down -3.7% on the year, the quarter on quarter number improved 0.6%. Other construction continues to struggle. Some hope for the RBA?s growth hand-off plan then.

Westpac sees the following internals:

Private infrastructure work, which is lumpy from quarter to quarter, rose 7.8% in the quarter, following an increase of 1.1% in Q2 (revised up from 0.2%).

Private new residential building activity increased by 0.9%, following five quarters of decline. This is the start of an upswing, although the strength of the cycle remains uncertain.

Private renovation work fell once again, down 2.0%, the fourth consecutive fall. This is an indication that consumers have been relatively cautious over this time.

Private non-residential building activity slipped, down 3.0%. This follows rises in four of the last five quarters. The level of work in this segment remains around historic lows, as a share of GDP.

Public construction pulled back as we anticipated, but the correction was sharper than we allowed for, with a fall of 7.3% (vs f/c -2.5%). This follows a 1.9% rise in Q2, a result boosted by a ?burst? of activity prior to the end of the 2011/12 financial year.

The total of these, 1.7% quarter on quarter was below consensus of 2% but is still very strong. ?Still, this is one input into a GDP disappointment.

A couple of charts for ya:

Source: http://www.macrobusiness.com.au/2012/11/construction-sets-foundation-for-modest-gdp/

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