VIEW MORE ARTICLES FROM SECOND QUARTERLY COST REPORT

Summary: Inflation Makes Its Move

Cement: Price Hikes Shatter Years of Calm

Copper: Huge price hikes stymie subs

Steel: The art of negotiating price relief

Bridges: Dealing with steel price shock

Asphalt: High oil prices hit paving costs

Labor: Rising employment pressures costs

VIEW RELATED DATA

Builders’ Construction Cost Indexes

A surge in materials price escalation during the first half of the year has ripped through the industry’s major construction cost indexes. Average annual inflation measured by 13 indexes increased from 3.2% in the previous quarter to 5.6% for the quarter ending last April, the latest month that data is available for all 13 indexes. This is more than double the 2.3% annual inflation rate for this group of indexes in April 2003.

Upward pressure on the indexes is expected to continue. Since April, the materials component of ENR’s cost indexes has increased another 5.7%, pushing overall inflation measured by the BCI to 8.7%. Factory Mutual expects to see inflation tracked by its index jump to around 11% by July, up from a 2.6% rate recorded last January. The Lee Saylor materials/labor index is expected to record an inflation jump of about 8%, based on preliminary June data.

advertisement ...