3 US cities with the biggest increases in construction costs
Construction costs are rising across the country, but three U.S. cities have seen higher increases than the nationwide average, according to a recent report from Rider Levett Bucknall. Here is the latest scoop in the construction industry.
The nationwide average of costs increased 2.4% from January to April, but in Chicago, Denver, and New York City, costs increased at a higher rate — 4.10%, 3.95%, and 2.67%, respectively. Year over year, prices rose 7.5% nationally.
Julian Anderson, president of RLB North America, largely attributed the increases to labor struggles, inflation, a potential recession, and rising fuel prices. “The workforce shortage is hindering the industry’s ability to maximize construction growth,” he said.
Employment data confirms the shortage of workers in construction “is at a critical point,” Anderson wrote. The number of job openings remains high, while the number of unemployed construction workers has dwindled; the pool of skilled, experienced workers in the industry looking for jobs is small.
“Given this situation, industry analysts are attributing the slowing growth almost solely to the workforce shortage,” Anderson said.
Nevertheless, 36,000 new employees joined the workforce in May, but that only filled 7% of positions. RLB expects the Infrastructure Investment and Jobs Act to create 900,000 jobs, with more than half of those in construction.
However, timing and inflation will be vital in determining the new infrastructurefundst.
“So, as we all try to read the signs of the times and decide our next turn, one thing is clear: it’s important we commit to bringing new people along for the ride,” Anderson said.
Markets below the national quarterly average included:
Las Vegas (2.03%).
Los Angeles (2.14%).
San Francisco (1.57%).
Washington, D.C. (2.11%)