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Construction Costs Continue Increase, According to Turner Building Cost Index
Construction costs in the U.S. building industry increased in the third quarter by 1.89 percent over the second quarter, per the Turner Building Cost Index. This is a 7.74 percent increase over the third quarter 2006 index.
“The construction industry continues to face a shortage of skilled labor and trade contractor availability. The strength of the developing economies of the world has added to the demand for raw materials and equipment, adding to the pressure on material prices in the United States,” says Karl Almstead, Turner vice president.
Almstead says that in spite of increasing construction prices, the forecast for the market appears strong. “According to McGraw-Hill Construction, the non-residential building market activity grew five percent over the past twelve months. Confirmation of the continued strength in the construction industry is supported by the AIA’s June Architectural Billing Index,” he says.
Turner has issued this quarterly forecast for more than 75 years. The index is determined by nationwide labor rates and productivity, material prices and the competitive condition of the marketplace, according to the company.