Construction material prices rose 1.4% from October to November and are up 23.5% on a year-over-year basis, according to www.abc.org.
Nonresidential construction material prices rose 1.4% from October to November and increased 24.5% compared with one year ago. Softwood lumber prices are up 3.5% year-over-year and up 6% from October to November. Iron and steel prices are up 105.1% year-over-year and 3.6% for the month.
“Contractors are not the only people who should be concerned by today’s inflation figures,” said ABC Chief Economist Anirban Basu. “While contractors and the project owners they serve are most directly impacted by large, ongoing increases in materials prices, there are many other affected stakeholders. Among these are America’s taxpayers. Many are delighted by the passage of a consequential infrastructure package in November, yet rising materials prices mean that Americans may receive less value for each dollar spent. Rising labor costs point in the same direction.
“There is no indication that materials prices will fall in the near future,” Basu continued. “With the Omicron variant now circulating around the world and leading to a next wave of lockdowns and supply chain disruptions, demand for key commodities will continue to exceed supply. Among the implications is that estimators will be under enormous pressure to predict materials prices amid enormous volatility and uncertainty. Many ABC members expect profit margins to decline over the next several months, and today’s data release makes that more likely.”