Construction Materials Costs Outrun Prices in June
Construction costs again outpaced other producer prices in June, but contractors remained unable to recoup the costs through higher bid prices, according to an analysis of producer price index figures released in mid-July by the Associated General Contractors of America. Association officials said the ongoing cost squeeze would put new pressure on construction firms to reduce staff and possibly close down.
“Despite a one-month dip in the prices of some key materials in June, construction costs rose on a year-over-year basis at the highest rate since 2008,” said Ken Simonson, the association’s chief economist. “Worse, prices are rising amid continued layoffs and construction spending levels that hit an 11-year low in May.”