The Sacramento Business Journal is reporting that the Associated General Contractors of America has reported a national drop in commercial construction of 71% during June compared to the previous month.The drop more than made up for the rise experienced in May, when commercial construction rose 27%.

“Every construction category declined significantly in June,” said Jim Haughey, an economist for Reed Construction in a statement. “The May/June boom/bust is substantially random.”

The drop shows that nonresidential construction is entering the weakest period in the business cycle, he said. Compared to June 2008, however, the drop was 22%, and Haughey said he believes that’s a better indicator for the rest of the year.

“The current bid calendar suggests that much of the June drop will be reversed in the next few months,” he said.

The contractors also reported that falling prices for construction materials may be nearing an end. Nucor-Yamato Steel announced it was raising prices to match an earlier announcement by Gerdau Ameristeel; a concrete company announced a hike in aggregates and liquid asphalt prices also are edging up.

Source: Sacramento Business Journal