Engineering and construction costs slowed in September

Construction costs declined in September, according to the Engineering and Construction Cost Indicator from PEG and S&P Global Market Intelligence.

The Engineering and Construction Cost Indicator, which measures wage and material inflation for the engineering, procurement, and construction sector, experienced a net decline to 58.6 during the month, compared to 63.0 in August. But the index continues to represent upward pricing pressure.

The sub-indicator for materials and equipment costs increased by 5.2 points to 55.5, while the sub-indicator for subcontractor labor costs decreased to 66.0 in September. The latter was 68.5 in August.

Copper-based wire and cable saw the largest pullback, decreasing 25.0 points. Prices for turbines, fabricated structural steel, and ANSI pumps and compressors increased.

The six-month headline expectations for future construction costs indicators increased modestly to 75.9 in September. Ten of the 12 categories saw decreases in September, highlighted by an 18.3-point decrease from alloy steel pipe to 66.7 and a 14.4-point decrease from carbon steel pipe to 55.6.

Providing the greatest sources of upward pressure were a 9.8-point increase from redi-mix concrete to 78.6 and a 7.5-point increase from copper-based wire and cable to 87.5.