Office, paving and hospital projects helped construction spending post a slight gain in November, and Commerce Secretary Malcolm Baldrige said the slump in homebuilding is "nearly at an end."
The Commerce Department estimated the value of new construction completed in November increased 0.2 percent from October's level to an annual rate of spending of $230.3 billion. It was the first increase after seasonal adjustment since September's 0.5 percent gain.
November's rate also was 1.7 percent below the year-ago estimate of $234.3 billion.
And the value of construction put in place in 1981 through November was $217.5 billion, or 3.3 percent above the level for the same period of 1980.
After adjustment for inflation, however, new construction spending fell 0.1 percent in November, the 10th consecutive monthly decline, department officials said.
The November report showed that the spending to build new private homes fell 0.8 percent to an annual rate of $77.6 billion.
Despite the weak figures, Baldrige said there were "signs the homebuilding slump is nearly at an end." He pointed to recent figures showing improvement in new-house sales and housing starts.
"I wish I could believe that," Michael Sumichrast, chief economist of the National Association of Home Builders, responded.
He said any forecast such as Baldrige's is "premature," especially since the latest figures on the resale of home mortgages by savings and loans to investors showed an interest-rate increase.
Baldrige based his forecast on a previously reported advance in new-housing sales in November, a slight increase in housing starts and what he said was an indication that mortgage interest rates have been declining since November.
The latest report on construction expenditures, however, showed that spending on residential construction continued to decline in November, dropping 0.7 percent for the month for a total drop of 18.8 percent from November 1980.
Private construction overall was off 0.6 percent in November to a rate of $177.1 billion; public construction was up 2.9 percent to $53.1 billion.