The costs of raw materials used in construction — such as asphalt, iron, steel, and diesel — have fallen the past year and a half, but builders are still not seeing much of a savings. That’s because the costs of labor are soaring due to worker shortages in the construction field, according to new research from CBRE Inc., a real estate brokerage firm.
Average construction costs have risen by 1.8 percent in that time, according to the report. Average hourly wages for construction workers are on the rise as building increases but the number of workers in construction hasn’t kept pace.
“People who weren’t able to find jobs either went into another profession or retired,” says Andrea Cross, CBRE’s head of office market research in the Americas. “There’s been a struggle to find workers who have enough skills to come in and do the job efficiently.”
Source: “Builders Fail to Profit From Slump in Raw Materials Prices,” The Wall Street Journal (June 11, 2016)