Construction Activity in 1938 Largest Since 1930

Washington, Dec. 27-Construction activity in the United States during 1938 will aggregate approximat.ly $8,800,000,000, the largest total reported in any year since 1930, according to the annual estimate released today by the Bureau of Foreign and Domestic Com,merce and published in the December issue of the Survey of Current Business. The total, r,vhich includes not only the estimated current expenditure during the year for nerv construction, but also maintenance and rvork-relief construction, is an increase over the revised estimates of $8,675,000,000 for 1937. The increase in 1938 was the result of a gain of $54O,00O,00O in public'construction, which more than offset the decline in p,rit"1" *o.U. The movements of the preceding year were thus reversed-in 1937 the expansion as compared with 1936 was the result of a substantial increase in private work, while public expenditures for construction projects declined. Although the increase for the year 1938 was the fifth consecutive yearly gain, total expenditures for construction in 1938 were one-fourth less than the averag'e volume during the decade from l9N to l9D. There is a consi'derable variation in the move,ment of construction volume not indicated in the yearly estimates. While no series is fully adequate to measure construction expenditures in a given month, the indications are that projects were initiated in comparatively large volume during the first half o,f 1937, continuing the upward movement of the previous three years. Beginning in August and September, 7937, the volume of construction started fell off and continued at lower levels to the end of the year. The recession in construction projects initiated, excepting rvorkrelief projects, continued through the first half of 1938, but in the third quarter the volume of construction work undertaken rose to higher levels than a year earlier, and in the closing months of this year the totals rvere considerably larger than in 1937. The advance in construction in the latter part of 1938 was the result of a larger volume of public-works projects under the revived program of the Public Works Administration and increased private resi- dential building stimulated by lower building costs and lower interest charges and smaller initial payments required under the amended program of the Federal Housing Administration.

New' construction activity, which does not include maintenance and work-relief, declined slightly from $5,34O,000,000 in 1937 to $5,200,000,000 in 1938; however, it was more than twice the 1933 figure. This category of construction averaged $9,00O,00O,00O annually in the ten-year period ending in l9D and attained a peak of $10,948,000,Affi in 1927. The significance of this loss of nearly $5,000,000,000 is not fully realized until one considers the effect upon the 'r'i'hole economy of such an expenditure not only in the industry itself but also upon the attendant industries such as building materials, real estate, transportation, etc. Private residential construction declined in 1938 ,more than $100,000,000 to $1.285,000,000 and constituted but 25 per cent of all nen' construction as compared with an average of about 40 per cel1t for the clecade of the l920's. In spite of a decline in dollar volume the number of dwelling units upon which construction was started in 1938 was higher than in any year since 1929 and may attain 360,000 units. This total includes both private and public residential, but the increase is virtually all in the private field. As compared with other recent years residential building in 1938 was improved, but as compared with the years 1920 to l9D when the annual average number of units reached the high averag'e ol 675,ffi, activity was relatively low.

Primarily as a result of a drop of about one-third in factory building in 1938, total private nonresidential construction declined from $894,m0,000 to $745,000,000. Public trtility companies spent approximately 2O per'cent less for nerv construction in 1938 than in the previous year. Recently improved business conditions have favorably influe.nced the outlook for this type of construction.

New public construction, excluding federal rvork-relief construction, of the Federal Govern,ment was $1,275,000,@0 in 1936. The total for 1937 was slightly lower, and in

1938 the total is estimated at $1,310,000,00O. The workrelief constru,ction of the Federal Government under the Works Progress Administration is estimated to be $1,000,000,000 for 1938, a considerable increase over the preceding year and almost equal to the total expenditure made for the peak year 1936. State and local government construction also increased in 1938 and totaled more than $1,000,000,000.

Detailed preliminary estimates for 1938 and estimates for earlier years are presented in the article in the Survey of Current Business which also presents post-war trends in graphic fo'rm. These estimates are the regular annual continuations of those appearing in "Construction Activity in the United States" which was issued by the Bureau of Foreign and Domestic Commerce and ,covered a complete discussion of the concepts, scope, sources, and limitations of the estimates, as well as detailed figures from 1915 to 1936.

BIG CROWD ATTENDS HI-JINKS

Nearly three hundred lumbermen from all sections of Southern California attended the Lumbermen's Hi-Jinks at the Cafe De Paree, Los Angeles, Friday evening, December 16.

Dinner was served at7:N p.m. and two floor shows were staged during the evening. Russell Gheen was in charge of the entertainment and .music and he arranged a fine pfogram.

The party was sponsored by Lumbermen's Post, No. 403, American Legion, and the arrangement committee included Leo Hubbard, Russell Gheen, Ed Biggs, Milt Taenzer, Fred Morehouse and Maurv Alexander.