SOURCE: Leopardo Companies, Inc.

Leopardo Companies, Inc.

April 22, 2015 08:00 ET

Leopardo Releases 2015 Construction Economics Outlook

Rising Labor Expense Drives Increase in Construction Costs, Offsetting Low Energy Costs

CHICAGO, IL--(Marketwired - Apr 22, 2015) - Leopardo Companies, Inc. has released its 2015 Construction Economics Report and Outlook, an essential guide to help business leaders, healthcare administrators and government decision-makers understand the factors that impact construction costs.

This year's report shows that different factors have opposing effects on construction costs. Low oil prices greatly reduce the cost of construction, and some material costs have come down over the past year. But these factors reducing cost are more than offset by the strong increase in labor costs, brought on by a shortage of skilled workers as more than 25 percent of construction workers left the industry over the past five years. The overall effect in several large markets, like Chicago, is that construction costs are rising as development volume increases.

"Organizations that are considering new construction and renovation projects need to understand the factors in the economy and in the construction industry that may affect the timing and cost of their projects," said Leopardo President Rick Mattioda. "Our annual Construction Economics Report and Outlook offers a wealth of useful information to help people make informed decisions when building."

To create the report, Leopardo analyzed economic and construction industry data from universally respected sources, and utilized that data as well as the experience of the firm's principals to forecast the direction of construction costs over the next year.

The report provides current and recent costs relating to:

  • Construction materials, including steel, wood, concrete, asphalt, aluminum, copper and paint
  • Oil, electricity and other energy sources
  • Union and general wage increases for construction workers and specialty contractors
  • Average markup of contractor and subcontractor bids

Also included in the report is economic data such as the Producer Price Index, the Consumer Price Index, employment projections as well as construction spending by industry.

The report concludes with a snapshot of construction volume and trends by property type, including office, warehouse, hotel, multifamily residential, healthcare, educational, entertainment and public-sector properties.

To view the full report, visit http://www.leopardo.com/2015report/.

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