June 28, 2016
Second Quarter Turner Building Cost index reflects a shortage of skilled labor which continues to put upward pressure on costs as material prices remain at historic lows.
Turner Construction Company announced that the Second Quarter 2016 Turner Building Cost Index—which measures costs in the non-residential building construction market in the United States—has increased to a value of 983. This reflects a 1.34% increase from the First Quarter 2016 and a 4.80% yearly increase from the Second Quarter 2015.
“While we are seeing raw material prices remain at historic lows, a shortage of skilled labor continues to put upward pressure on costs. As a result, we are seeing subcontractors in the marketplace being very selective about what projects they have the resources to support,” said Attilio Rivetti, the Turner vice president responsible for the cost index. “In addition, the prices of fabricated materials and components—such as steel, framing, and gypsum—are expected to increase due to overall demand.”
Turner has prepared the construction cost forecast for more than 80 years. Used widely by the construction industry and Federal and State governments, the building costs and price trends tracked by the Turner Building Cost Index may or may not reflect regional conditions in any given quarter. The Cost Index is determined by several factors considered on a nationwide basis, including labor rates and productivity, material prices and the competitive condition of the marketplace. This index does not necessarily conform to other published indices because others do not generally take all of these factors into account.
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