Construction bid prices have continued to grow under the pressure of supply chain and labor challenges, according to an analysis by the Associated General Contractors of America.
Construction bid prices have continued to grow under the pressure of supply chain and labor challenges, according to an analysis by the Associated General Contractors of America.
The producer price index (PPI) for nonresidential building construction—a measure of what a fixed group of contractors estimate they would charge to erect a specific set of nonresidential buildings—climbed 3.0% from September to October and jumped 20.2% compared with October 2021.
The PPI for new residential construction fell 3.1% compared with September but increased 8.1% year-over-year.
“Although some materials costs have moderated, other costs are still climbing steeply, while contractors are incurring added expenses from delays caused by supply chain disruptions, shortages of skilled labor, and rising interest rates,” AGC Chief Economist Ken Simonson said in a statement. “Some owners may delay or cancel projects as the price to complete them continues to increase, threatening to undermine overall demand.”
The PPI for lumber and plywood dropped 9.9% compared with September but rose 1.3% compared with October 2021. The PPI for architectural coatings surged 27.5% year-over-year.
The full AGC report can be found here.