Prices of construction materials rose more than 20% from January 2021 to January 2022, according to an Associated General Contractors of America analysis of government data.
“Unfortunately, there has been no letup early this year in the extreme cost runup that contractors endured in 2021,” said Ken Simonson, the association’s chief economist. “They are apparently passing on more of those costs but will have a continuing challenge in getting timely deliveries and finding enough workers.”
The producer price index for inputs to new nonresidential construction — the prices charged by goods producers and service providers such as distributors and transportation firms — increased 2.6% from December to January and 20.3% over the past year, according to the analysis.
The index for new nonresidential construction — a measure of what contractors say they would charge to erect five types of nonresidential buildings — climbed by 3.8% for the month and 16.5% from the prior year.
“A wide range of inputs contributed to the more than 20% jump in the cost index,” AGC said.
The price index for steel mill products soared 112.7% over 12 months despite declining 1.6% in January. The index for plastic construction products climbed 1.8% for the month and 35% over 12 months.
The index for diesel fuel jumped 5.1% in January and 56.5% for the year. The index for aluminum mill shapes jumped 5.6% in January and 32.7% over 12 months, while the index for copper and brass mill shapes rose 4.1%in January and 24.8% over the year, according to the analysis.
Architectural coatings such as paint had an “unusually large price gain” of 9% in January and 24.3% over 12 months. The index for lumber and plywood grew 15.4% for the month and 21.1% year-over-year.
Other inputs with double-digit increases for the past 12 months included roofing asphalt products, 19.8%; insulation, 19.2%; trucking, 18.3%; and construction machinery and equipment, 11.4%.