Business outlays on structures rose 7 percent in the second quarter, and construction data indicate that the sector expanded further in both July and August. Still, nonresidential structures are notoriously difficult to project with any certainty. Many sectors of the economy wax and wane along with the overall business cycle, but the structures sector tends to follow long cycles of its own.
Although a weak economy is generally detrimental to spending in this category, expenditures often continue to increase well into an economic downturn, making forecasting difficult. In addition, the nonresidential structures category includes a diverse set of buildings, and forecasting this sector requires keeping tabs on a wide variety of indicators.