www.bea.gov

Digging into Construction Data

Jeff CrawfordNABE Teleconference

April 8, 2010

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Private Fixed Investment in structures

▪Useful references on www.bea.gov

How BEA Accounts for investment in Private Structures by Paul Lally

Survey of Current Business (February 2009)

Measuring the Economy: A Primer on GDP and National Income and product Accounts

http://www.bea.gov/national/index.htm

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Construction Statistics in the NIPAs

Fixed Investment Private investment in structures and

equipment and software. Also government investment

▪Fixed Assets Statistics for net stock, investment,

depreciation, other changes in volume of assets

▪GDP by Industry Industry composition of U.S, economy by value

added (Gross output minus intermediate inputs)

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Finding Fixed Investment Data

▪ From BEA homepage www.bea.gov

▪ Interactive data tables Interactive Tables National Economic Data National income and product accounts

Choose a table from a list of All NIPA Tables

5 - Saving and Investment

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Investment in structures

Investment in Structures is measured mainly as the sum of the costs of inputs of all construction “put in place” during the accounting period. Included are:

Costs of materials installed or erected Costs of labor and the cost of construction equipment

rental Cost of architectural and engineering work Overhead and office costs incurred by the projects

owners Interest and taxes paid during construction Contractors’ profit

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Other expenditures in private investment

Brokers’ commissions on the sale of new and used structures

Net purchases of used structures from government

Improvements to structures Mining exploration, shafts and wells Other investment (mobile structures,

manufactured homes)

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Residential Investment

In NIPA, home ownership is treated as a business analogous to rental housing.

Housing services of owner-occupants is represented by imputed rent in personal consumption expenditures (PCE).

Imputed rental income for owner-occupants is add to rental income of persons

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“Real” – Inflation adjusted quantity measures

Deflation: for most components the current dollar measure is divided by appropriate price index

Direct valuation: quantity measure is multiplied by a base period price.

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Price Indexes

▪BEA uses a variety of price measures from the Census Bureau, Bureau of Labor Statistics, and trade sources.

▪A longstanding goal has been to use, when possible, price measures that have been adjusted for quality changes

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Input price indexes

▪ Because of the heterogeneity of construction projects, structures have historically been priced by their inputs.

▪ Input price index do not account for material or labor substitution and productivity gains

▪ For hospitals, the Turner Construction Company building cost index (an input cost measure) is combined with the single-family houses index to capture some of the effects of productivity gain

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Output price indexes

▪ Output price indexes capture the effect of changing productivity

▪ Census Bureau new single-family house index▪ BLS Nonresidential building construction

sector indexes Warehouse building School building Office building Industrial building

http://www.bls.gov/ppi/ppinrbc.htm