In 2005, U.S. businesses invested $1.15 trillion in both new and used capital goods, an increase of 10.0 percent from 2004. The final 2004 estimate of $1.04 trillion, reflects a downward revision of $5.4 billion. (See Tables 1a and 1b.)

Expenditures for structures totaled $401.6 billion, with $365.7 billion (91.1 percent) spent for new structures, an increase of 12.6 percent from 2004. Expenditures for equipment totaled $744.4 billion, with $702.2 billion (94.3 percent) spent for new equipment, an increase of 11.7 percent from the prior year. In 2005, spending on new structures and equipment totaled $1.07 trillion, an increase of 12.0 percent from 2004.

Companies with employees accounted for $1.06 trillion of capital spending in 2005, an increase of 11.6 percent from 2004. These companies invested $368.7 billion in structures, an increase of 9.9 percent from 2004. They invested $695.0 billion in equipment, an increase of 12.5 percent from 2004.

Capital expenditures by companies without employees in 2005 totaled $82.2 billion. Equipment spending by these companies accounted for 60.0 percent of their total spending. Companies without employees were not asked to report capital expenditures by sector or industry.

• Tables

Highlights of capital expenditures by business sector and industry for companies with employees

(See Tables 2, 3, and 4.)

[Business sector data are based on the 2002 North American Industry Classification System.] Of the 135 industries covered in this report, 43 had a statistically significant increase in spending, 6 had a statistically significant decrease, and 86 showed no statistically significant change from the prior year.

Manufacturing

The manufacturing sector spent $165.2 billion on capital goods in 2005, an increase of 5.5 percent from 2004. Of the total spending by this sector, $33.7 billion was for structures, and $131.5 billion was for equipment.

Investment spending by durable goods manufacturers totaled $92.4 billion, an increase of 8.6 percent from the prior year. Of this total, $14.8 billion, was for structures, while expenditures for equipment amounted to $77.6 billion. The motor vehicle and parts industry was the largest durable goods investor, spending $23.5 billion in 2005. The semiconductor industry was the second largest durable goods investor, at $10.3 billion.

Nondurable goods manufacturers spent $72.8 billion on capital goods in 2005. Spending for structures was $18.9 billion, and for equipment, $54.0 billion. The food manufacturing industry was the largest spender in this category in 2005 with $14.3 billion, followed by the petroleum and coal products industry with spending at $10.3 billion, and the pharmaceutical and medicine manufacturing industry at $10.1 billion.

Finance and insurance

The finance and insurance sector spent $161.6 billion on capital goods in 2005. Of this spending, $39.1 billion was for structures, and $122.5 billion was for equipment. The leading industry spender in this sector was nondepository credit intermediation (i.e., sales and lease financing, and credit card issuing) at $92.5 billion, an increase of 15.6 percent from 2004.

Real estate and rental and leasing

This sector spent $103.2 billion on capital goods in 2005, an increase of 12.7 percent from the prior year. The automotive equipment rental and leasing industry was the leading spender in this sector at $50.1 billion, up 13.4 percent from 2004, with virtually all spending in equipment. The second leading spender in this sector, real estate, spent $28.9 billion, with 83.5 percent of this amount spent on structures.

Information

The information sector spent $91.3 billion on capital goods in 2005, an increase of 9.3 percent from the prior year. Of this sector’s spending, $32.0 billion was for structures and $59.3 billion was for equipment. The leading spenders in this sector were the wireless telecommunications carriers at $27.3 billion, an increase of 13.9 percent from 2004, and the wired telecommunication carriers at $27.1 billion, an increase of 10.8 percent.

Retail trade

In 2005, capital spending by the retail trade sector was $73.8 billion. Of this spending, $34.2 billion was for structures and $39.6 billion was for equipment. The leading spender in this sector was other retail trade stores, including the gasoline stations industry, which spent $26.1 billion in 2005, $11.6 billion in structures and $14.5 billion in equipment. The general merchandise stores industry spent $17.7 billion in 2005, an increase of 4.3 percent from the prior year.

Health care and social assistance

The health care and social assistance sector spent $73.8 billion for capital expenditures in 2005, an increase of 14.3 percent from the prior year. Spending by general medical and surgical hospitals increased 15.1 percent from 2004 to $41.8 billion in 2005. The outpatient care centers and other ambulatory health care services industry spent $4.6 billion in 2005, an increase of 32.1 percent from the prior year.

Mining

The mining sector spent $66.8 billion on capital goods in 2005, an increase of 30.4 percent from the prior year. Spending for structures more than doubled that of equipment, $46.4 billion and $20.4 billion respectively. The oil and gas extraction industry led this sector’s spending with $50.5 billion in capital expenditures, up 25.6 percent from the prior year, and accounted for 75.6 percent of this sector’s overall spending.

Utilities

The utilities sector spent $58.4 billion on capital goods in 2005, an increase of 15.8 percent from the prior year. The electric power generation and distribution industry spent $47.2 billion, or 80.9 percent of this sector’s investment. The natural gas distributors industry spent $8.5 billion on capital goods.

Transportation and warehousing

Investment in this sector was $56.6 billion in 2005, an increase of 22.9 percent from 2004. The truck transportation industry spent $17.6 billion in 2005, an increase of 61.8 percent from the $10.9 billion reported in 2004. The air transportation industry spent $9.5 billion, a decrease of 6.1 percent from 2004. The rail transportation industry spent $8.3 billion, an increase of 15.5 percent from 2004.

Wholesale trade

The wholesale trade sector spent $40.5 billion on capital goods in 2005. The durable goods industry spent $24.4 billion, and the nondurable goods industry spent $15.3 billion.

Professional, scientific, and technical services

This sector spent $33.3 billion for capital goods in 2005, up 24.8 percent from the prior year. The scientific research and development services industry accounted for $7.8 billion of this sector’s capital expenditures in 2005.

Accommodation and food services

This sector’s capital spending in 2005 amounted to $31.5 billion and accounted for one of the largest percent increases from 2004 at 52.5 percent. The food services and drinking places industry spent $16.5 billion on capital goods in 2005, an increase of 45.3 percent from 2004. The traveler accommodation services industry, which includes hotels and casino hotels, spent $15.0 billion, an increase of 61.3 percent from the 2004 level of $9.3 billion.

Construction

The construction sector spent $30.1 billion for capital goods in 2005. Spending by special trade contractors amounted to $15.3 billion.

Other services (except public administration)

This sector, which includes various types of business, religious, and social organizations, repair and maintenance services, and personal services, spent $19.8 billion on capital goods in 2005. The religious, grantmaking, social advocacy, and organizations industry was the largest spender in 2005 at $11.1 billion.

Administrative and support and waste management

This sector spent $18.3 billion on capital goods in 2005. The investigation, security, and services to buildings and dwellings industry spent $5.2 billion on capital goods and accounted for 28.2 percent of this sector’s spending.

Educational services

The educational services sector spent $17.7 billion on capital goods in 2005. Spending for structures totaled $12.8 billion and spending for equipment totaled $5.0 billion.

Arts, entertainment, and recreation

This sector spent $14.1 billion on capital goods in 2005. The amusement, gambling, and recreation industry, which accounts for 68.2 percent of capital expenditures in this industry, spent $9.7 billion.

Note: Revised 2004 ACES data and associated relative standard error tables are included in this publication. The data in this report are subject to sampling variability, as well as nonsampling error. Further details concerning survey design, methodology, and data limitations are contained in the appendixes of this publication.