From
the U.S. Census Website
Capital
Spending Reaches All-Time High
Capital spending by U.S. nonfarm businesses reached an all-time
high of $1.31 trillion in 2006, topping the $1.16 trillion in
2000 and $1.14 trillion in 2005.
These results come from the U.S. Census Bureau’s Annual
Capital Expenditures Survey: 2006, which measures business spending
for new and used structures and equipment. The survey defines
capital goods as business assets that have an expected useful
life of more than a year and that are usually depreciated.
Spending on new structures and equipment accounted for almost
$1.23 trillion, a 14.8 percent increase over 2005. Nearly 63
percent of this spending ($774.7 billion) went for equipment,
with the rest ($450.9 billion) allocated to structures. Spending
on used structures and equipment totaled $83.8 billion.
The Annual Capital Expenditures Survey collects data from businesses
with and without employees, but only businesses with employees
are asked to report by industry. Businesses with employees accounted
for $1.22 trillion, or 92.9 percent of all capital investment,
in 2006. Businesses without employees accounted for $92.8 billion.
Sector and industry highlights:
The
manufacturing sector spent $191 billion on capital goods in
2006, a 15.3 percent increase over 2005.
Durable goods manufacturers accounted for $105 billion in capital
spending in 2006. The two durable goods industries with the
largest investments were motor vehicle and parts ($24.4 billion),
and semiconductor and other electronic components ($14.9 billion).
Nondurable goods manufacturers accounted for $86.1 billion in
spending. The two nondurable goods industries with the highest
spending were food manufacturing ($16.6 billion), and petroleum
and coal products ($14.7 billion).
After manufacturing, the two sectors accounting for the largest
capital expenditures were finance and insurance ($169.4 billion),
and real estate and rental and leasing ($122.4 billion). These
totals represented annual increases of 5 percent and 18.9 percent,
respectively.
The information sector spent $104.6 billion on capital goods
in 2006, an increase of 14.5 percent over 2005. One-third of
capital spending in this sector went to structures and two-thirds
to equipment.
The mining sector spent $98.3 billion on capital goods in 2006,
an increase of 47.3 percent over 2005. In 2006, the oil and
gas extraction industry accounted for 76.3 percent of the mining
sector’s total capital spending. In contrast to the information
sector, mining allocated roughly two-thirds (69.1 percent) of
its capital spending to structures and roughly one-third (30.8
percent) to equipment.
Of the 135 industries covered in the report, 54 had an increase
in spending in 2006, 13 had a decrease, and 68 showed no significant
change from the prior year.
