Facility Management Cost Trends: Construction Activity and Materials Prices Head Upward

Total construction is up around 2% over last year, and is headed for more positive territory in this year’s second quarter. Notable increases are evident in the manufacturing, educational, and healthcare sectors. However, public works spending, except public healthcare, is showing decreases.

The overall increase for construction materials this year should be in the 3% range. Lumber is down 3% and steel up 6%. Asphalt is still on the way up due to higher petroleum prices, while cement seems to have reversed its course and is also on the way up. After years of dramatic spikes and dips, stainless steel has begun to level out. Carpet is now recording increases in the 5–6% range after years of increases in the 2% range. Common brick is going nowhere but down. Hefty increases in the 6–8% range have typified paint prices in previous years, and a similar increase is likely in 2012. Unlike framing lumber, which is down 3%, plywood seems to be comparatively steady since the end of 2010.

Note: All data is based on indices rather than unit or quantity prices.

Source: U.S. Department of Labor, Producer Price Index