Growing Construction Demand and Supply Chain Disruptions Lead to Increase in Construction Costs

Turner Construction Company announced that the Second Quarter 2021 Turner Building Cost Index-which measures costs in the non-residential building construction market in the United States-had increased to the value of 1187. This represents a 1.28% quarterly increase from the First Quarter 2021 and a 0.85% yearly increase from the Second Quarter 2020.

'An increase in demand for construction services combined with pandemic related supply chain disruptions led to a spike in construction costs for material including lumber, steel, copper, aluminum, PVC and gypsum. Towards the end of the Second Quarter 2021, raw material costs appeared to stabilize, but it may be months before we see any resulting impacts in the supply chain or in fabricated costs,' said Attilio Rivetti, the Turner vice president responsible for compiling the Cost Index.

Turner has prepared the construction cost forecast for more than 80 years. 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.

Click here to see the Second Quarter 2021 report.