Jeff McDonald//December 16, 2013//
National data on construction materials costs shows a construction economy that is starting to right itself, said Mike Salsgiver, executive director of Associated General Contractors’ Oregon-Columbia chapter. But the recovery is tepid and spread unevenly across industry, he said.
While prices for construction-related materials month over month were mostly flat or falling through November, the prices of gypsum products and insulation materials year over year were up 13.7 percent and 8.2 percent, respectively, according to a report released Friday by the U.S. Bureau of Labor Statistics.
The Producer Price Index indicated hardwood and softwood lumber prices were up 20.8 percent and 12.8 percent, respectively, according to the data. Plywood was up 3.1 percent.
The demand for gypsum and insulation materials is a sign that more remodels and tenant improvements are taking place because commercial work has slowed since the downturn, Salsgiver said.
Strong demand for lumber and plywood is a clear indicator of a housing recovery, which matches national trends over the past eight or nine months, he said.
Housing is a leading indicator for the rest of the construction industry, Salsgiver said.
“It shows movement in the right direction,” he said. “It shows a construction economy that is starting to right itself.”