With construction spending in the United States surging to its highest level on record in August, the U.S. Department of Commerce is grappling with a serious side effect of the boom — higher prices and shortages of construction materials.
Commerce Secretary Donald Evans addressed that concern and talked about the strength of the U.S. economy in general during a speech Friday to the Associated General Contractors of America meeting at the J.W. Marriott Desert Ridge Resort in north Phoenix.
Specifically, he said the department is seeking ways to allow more Mexican cement to be imported into the United States to ease shortages here and overcome an antidumping order that has limited Mexican imports, he said.
"The Bush administration has continued informal talks with the Mexican government and with representatives from the U.S. and Mexican cement industries," he said. "We have and will continue to work to identify an alternative solution . . . and hopefully we’ll see cement prices come down."
Material shortages and skyrocketing costs have emerged as problems for Valley homebuilders, who have been struggling to keep up with demand for new houses.
Nationally, Evans said the value of construction in August topped $1 trillion on an annualized basis, an all-time record and an 0.8 percent increase from July’s level.
The vigor exhibited in construction in August partly reflected a strong showing in residential projects by private builders, which hit a record high.
The 0.8 percent advance was twice as big as the 0.4 percent increase the economists were forecasting. In more encouraging news, July’s performance turned out to be even stronger than previously estimated.
Revised figures showed that construction spending jumped by 1.1 percent in July from the previous month.
‘‘This was an extremely strong and encouraging report,’’ said Kenneth Simonson, chief economist at Associated General Contractors.
Overall the construction industry employs nearly 7 million people, or about 6 percent of the nation’s nonfarm private sector work force, Evans said.
"You’re doing it. You’re creating jobs," Evans told the contractors. "A job just happens to be what every one in the world wants."