Low bid prices squeeze contractors but spur Indiana work
The producer price index for finished goods rose 0.2 percent in April, not seasonally adjusted (but fell 0.1 percent, seasonally adjusted) and 5.5 percent over the past 12 months, the Bureau of Labor Statistics announced on Tuesday [May 18]. Contractors were again squeezed by rising input costs and falling bid prices. The PPI for inputs to construction industries, a weighted average of the cost of materials used in every type of construction plus items consumed by contractors, such as diesel fuel, jumped 1.1 percent for the month and 5.7 percent over 12 months. Highway and street construction experienced increases of 1.1 percent and 8.3 percent; other heavy construction, 1.1 percent and 6.7 percent; nonresidential buildings, 1.0 percent and 5.1 percent; multi-unit residential, 0.9 percent and 4.1 percent; and single-unit, 0.9 percent and 3.9 percent. The PPI for new building construction, which reflects contractors’ labor, overhead and profit as well as materials, fell 0.1 percent and 4.3 percent for offices; new industrial buildings, 0 and -4.0 percent; new warehouses, +0.2 percent and -4.6 percent; and new schools, +0.7 percent and -1.5 percent, according to a May 21 Data DIGest report.