Construction spending fell 0.7 percent in April for the second consecutive month, the government reported. Analysts said the report signaled a weakening building industry.
The Commerce Department said residential, nonresidential and government construction spending totaled a seasonally adjusted annual rate of $432.4 billion in April.
The revised 0.7 percent March decline was improved from the 1.4 percent drop first reported last month.
The decreases in March and April spending followed gains of 3.2 percent in February and 2.4 percent in January and resulted in the loss of about 159,000 construction jobs.
"We had strong construction employment in the first quarter when we had great weather," said David F. Seiders, chief economist for the National Association of Home Builders. "But if you look at the next two months, that's really quite a decline."
The construction spending report "combined with the employment numbers are two more signals of a pretty sluggish economy," Seiders said.
Two other reports portend further weakening. The government's most recent overall job figures showed the unemployment rate fell to 5.3 percent in May as weak job growth continued. The Labor Department reported 20,000 more construction jobs were lost in the month.
And the F.W. Dodge division of McGraw-Hill Inc. reported that contracts for new construction declined 6 percent in April, a four-year low.
Analysts attribute the construction slump to high interest rates and tighter restrictions on lending.
Residential building edged down 0.3 percent to an annual rate of $202.7 billion after rising 2 percent in March, even better than the 1.8 percent increase first reported last month.
Single-family building dropped 2.2 percent to an annual rate of $120 billion after a 1.2 percent increase in March.
Apartment construction, on the other hand, rose 6 percent to $21 billion. It had dropped 4.3 percent in March.
With mortgage rates in the double digits and sales of new homes declining, residential construction "is destined to keep going down," Seiders said, adding that the jump in multifamily building was an aberration.
"The multifamily sector has been really weak and sliding for some time and will resume its downward path next month," Seiders predicted.
Nonresidential construction such as office and industrial buildings edged up 0.6 percent to $104.2 billion after rising 2.4 percent in March.
The volatile government sector fell for the second straight month, down 3.5 percent to $87.6 billion. Highways and streets spending paced the drop with a 8.2 percent decline.
Government construction spending had fallen 4.9 percent in March after gaining 5.2 percent in February.
Overall construction spending in April was 5 percent above that of the same month in 1989, when it totaled $411.9 billion.