U.S. builders barely increased their spending on construction projects in March after two straight months of declines. A pickup in single-family home construction and commercial projects offset a steep drop in state and local government building, AP reported. The Commerce Department said Tuesday that construction spending ticked up 0.1 percent. The small March gain left construction spending at a seasonally adjusted annual rate of $808.1 billion. That's 6 percent above a 12-year low of $762.6 billion hit last March. Still, the level of spending is roughly half of what economists consider to be healthy. Still, even with the increase in private construction spending, the trend over the last three months is weak, Ryding noted. Government construction activity fell 1.1 percent to the slowest pace since February 2007, the report said. Spending by state and local governments dropped to the weakest level since November 2006, while spending by the federal government rose 3.8 percent to a rate of $28.9 billion. Spending on private nonresidential projects rose 0.7 percent. Work on office buildings, hotels and transportation projects rose. Spending in the category that includes shopping centers fell. Private residential activity rose 0.7 percent. The increase was driven by more construction of single-family homes. Even with the games, home construction continues to slump five years after the housing bubble burst. Sales of new homes fell 7.1 percent in March, the largest decline in more than a year. Though new-home sales represent less than 10 percent of the housing market, they have an outsize 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 the National Association of Home Builders. -- SPA