Construction input prices remained unchanged in June compared to the previous month, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics Producer Price Index data released today. Nonresidential construction input prices were also unchanged for the month.
Overall construction input prices are 4.9% lower than a year ago, while nonresidential construction input prices are 4.5% lower. Prices decreased in all three energy subcategories in June. Crude petroleum prices were down 5.9%, while natural gas prices fell 5.3%. Unprocessed energy materials prices decreased 5.0% for the month.
“The pandemic-induced period of rapid construction input cost increases is over,” said ABC Chief Economist Anirban Basu. “Today’s Producer Price Index data, along with yesterday’s Consumer Price Index release, show that inflation has slowed, at least with regard to goods prices. This recent moderation is partially due to a drastic improvement in supply chains; both international and domestic freight rates have plunged back toward pre-pandemic levels.
“Despite this recent cooling, construction input prices are still up more than 38% since the start of the pandemic,” said Basu. “That’s over twice the increase observed for economywide prices over that span. Contractor confidence declined last month, according to ABC’s Construction Confidence Index, and the combination of expensive materials, high interest rates that are likely to rise again at the Federal Reserve’s July meeting and tight credit conditions will put downward pressure on construction activity over the next few quarters.”
Related Stories
Giants 400 | Oct 30, 2017
Top 85 green construction firms
Turner Construction Co., Clark Group, and AECOM top BD+C’s ranking of the nation’s largest green sector contractors and construction management firms, as reported in the 2017 Giants 300 Report.
Multifamily Housing | Oct 29, 2017
Multifamily visionaries: The Beach Company’s family ties
Spanning four generations, The Beach Company continues to expand its development footprint across the Southeast.
Sports and Recreational Facilities | Oct 23, 2017
Top 50 sports construction firms
AECOM, Mortenson Construction, and Turner Construction Co. top BD+C’s ranking of the nation’s largest sports sector contractors and construction management firms, as reported in the 2017 Giants 300 Report.
Giants 400 | Oct 19, 2017
Race for talent drives office designs
Is the shift toward attracting younger workers too much or not enough?
Giants 400 | Oct 16, 2017
Data center market forecast: Clearly cloudy
Look for mission-critical construction to double in the next few years.
Data Centers | Oct 13, 2017
Top 35 data center construction firms
Turner Construction Co., Holder Construction, and DPR Constrcution top BD+C’s ranking of the nation’s largest data center sector contractors and construction management firms, as reported in the 2017 Giants 300 Report.
Giants 400 | Oct 9, 2017
Top 80 K-12 construction firms
Gilbane Building Co., Balfour Beatty US, and Skanska USA top BD+C’s ranking of the nation’s largest K-12 sector contractors and construction management firms, as reported in the 2017 Giants 300 Report.
AEC Tech | Oct 6, 2017
How professional bias can sabotage industry transformation
Professional bias can take the form of change-resistant thinking that can keep transformational or innovative ambitions at bay. Tech consultant Nate Miller presents three kinds of bias that often emerge when a professional is confronted with new technology.
Giants 400 | Oct 5, 2017
On wings of gold: Alternative financing schemes are propelling the high-flyin’ air terminals sector
The $4 billion renovation of New York City’s LaGuardia Airport is the first major U.S. aviation project delivered using a public-private partnership (P3) model.
Giants 400 | Oct 4, 2017
Top 40 airport construction firms
Hensel Phelps, Turner Construction Co., and Skanska USA top BD+C’s ranking of the nation’s largest airport sector contractors and construction management firms, as reported in the 2017 Giants 300 Report.
