Construction spending rose 0.6% in December to an annual rate of $811.5 billion after posting a 0.2% increase in November, the Commerce Department said. The number was in sharp contrast with expectations from analysts who had estimated the department's report would show a 0.4% drop in construction spending in December.

For all of 2000, construction spending rose 5.7% to $807.8 billion from $764.2 billion in the previous year. The gain last year was down from a 7.4% rise in 1999.

In December, construction on single-family homes rose 1.1% to $229.7 billion while spending on office building increased 1.9% to $58.3 billion. The gains more than offset drops in spending on industrial projects, hospitals and hotels.