Steel Markets
September 17, 2018
Labor Shortage and Material Costs Squeeze Construction Margins
Written by Sandy Williams
Construction costs are escalating due to labor costs and tariffs on critical materials. Although declining 0.8 percent from July to August, prices for construction goods such as diesel fuel, steel, aluminum, asphalt and gypsum products have risen 6.2 percent since the beginning of the year, said the Associated General Contractors of America in a recent analysis of Labor Department data.
The producer price index revealed an increase of 33.9 percent for diesel fuel, 18.6 percent for steel mill products, 14.0 percent for aluminum mill shapes, 9.2 percent for asphalt paving mixtures and blocks and 8.2 percent for gypsum products. Adding to the margin squeeze is higher rates for freight shipments. The price index for truck transportation of freight has climbed 7.2 percent this year.
