Trying to predict when the industry recovery will kick in, construction economists can only agree that things will get better, just not next year. While the optimists are hoping healthy markets will return in 2013, the pessimists are hoping for 2014 or even 2015 (see ENR 11/14/11 p. 10). Next year's expected weak demand underlies ENR's forecast for its cost indexes in 2012. Unemployment will continue to keep labor costs in check, and neither lumber, steel nor cement prices are expected to make much headway.
With that backdrop, ENR is forecasting a 2.1% increase in its Construction Cost Index in 2012, following this year's 2.5% increase. The forecast for the Building Cost Index is for it to increase 2.3% next year, after increasing 2.9% in 2011.