Construction input prices increased 0.9% in April on a monthly basis and 2.4% compared to the same time last year, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics data released today. Nonresidential input prices rose 0.9% compared to March and are up 2.8% on an annual basis.
Among the 11 sub-categories, seven experienced price decreases last month, with the largest decreases in natural gas (-8.7%), iron and steel (-1.7%), and steel mill products (-1.7%). The four sub-categories that experienced monthly price increases were crude petroleum (+13.9%), unprocessed energy materials (+3.7%), prepared asphalt products (+2.7%) and concrete products (+1.1%). Year over year, prepared asphalt products (+7.5%), steel mill products (+5.8%) and plumbing fixtures (+4.3%) experienced the largest price increases.
“Even though April was the third consecutive month that input prices increased and overall materials prices remained elevated, there is little reason for contractors to be on high alert,” said ABC Chief Economist Anirban Basu. “The increase in materials prices was primarily driven by higher energy prices. In particular, the price of oil mainly rose for political reasons, and therefore is not an indication that materials prices will aggressively increase.
“What’s more, the year-over-year increase in construction input prices is a mere 2.4%, which is only slightly higher than overall inflation and a bit lower than wage growth,” said Basu. “With much of the global economy slowing and given ongoing trade tensions between American and Chinese policymakers, it’s likely materials price increases will remain modest going forward, even in the context of a robust nonresidential construction sector.
Related Stories
Market Data | Sep 27, 2019
The global hotel construction pipeline ascends to new record highs
With the exception of Latin America, all regions of the globe either continued to set record high pipeline counts or have already settled into topping-out formations amidst concerns of a worldwide economic slowdown.
Market Data | Sep 25, 2019
Senate introduces The School Safety Clearinghouse Act
Legislation would create a federally funded and housed informational resource on safer school designs.
Market Data | Sep 18, 2019
Substantial decline in Architecture Billings
August report suggests greatest weakness in design activity in several years.
Market Data | Sep 17, 2019
ABC’s Construction Backlog Indicator inches lower in July
Backlog in the heavy industrial category increased by 2.3 months and now stands at its highest level in the history of the CBI series.
Market Data | Sep 13, 2019
Spending on megaprojects, already on the rise, could spike hard in the coming years
A new FMI report anticipates that megaprojects will account for one-fifth of annual construction spending within the next decade.
Architects | Sep 11, 2019
Buoyed by construction activity, architect compensation continues to see healthy gains
The latest AIA report breaks down its survey data by 44 positions and 28 metros.
Market Data | Sep 11, 2019
New 2030 Commitment report findings emphasize need for climate action
Profession must double down on efforts to meet 2030 targets.
Market Data | Sep 10, 2019
Apartment buildings and their residents contribute $3.4 trillion to the national economy
New data show how different aspects of the apartment industry positively impact national, state and local economies.
Market Data | Sep 3, 2019
Nonresidential construction spending slips in July 2019, but still surpasses $776 billion
Construction spending declined 0.3% in July, totaling $776 billion on a seasonally adjusted annualized basis.
Industry Research | Aug 29, 2019
Construction firms expect labor shortages to worsen over the next year
A new AGC-Autodesk survey finds more companies turning to technology to support their jobsites.