Government construction spending barely rose, to a level that's still below its rate of a year ago. Public projects have been under stress because of budget problems at all levels of government.
Federal construction spending rose 10.7 percent in October. But spending fell slightly among state and local governments.
From July through September, residential construction grew at an annual rate of 14.2 percent. Housing construction is on track to contribute to economic growth this year -- the first time that's happened in the five years since the housing bubble burst.
Though new homes represent only a fraction of the housing market, they have an out-size impact on the economy. Each home built creates an average of three jobs for a year and generates about $90,000 in tax revenue, according to statistics from the National Association of Home Builders.
Builders are increasingly confident that the housing recovery will endure. A measure of their confidence rose in November to the highest level in six and a half years. And builders broke ground on new homes and apartments in October at the fastest pace in more than four years.
But there are factors dragging on the housing recovery. Many Americans, particularly first-time homebuyers, are unable to qualify for a mortgage. And many can't afford larger down payments that are being required by banks.
While housing has strengthened this year, the broader economy has lagged behind. The government reported last week that overall economic growth increase to an annual rate of 2.7 percent in the July-September quarter, up from 1.3 percent in the April-June quarter.
But through the first nine months of this year, economic growth has averaged just 2 percent, far below what is needed to make a significant dent in unemployment.
Many analysts think growth is slowing in the current October-December quarter to below 2 percent. The disruptions caused by Superstorm Sandy weighed on consumer spending in October.And many consumers and businesses may also be worried about automatic tax increases and spending cuts that are scheduled to kick in next year, if Congress and the Obama administration fail to reach a deal before then to avert them.