More Bridge for Your Buck
After a painful period of price inflation, the cost of concrete, steel and asphalt is dropping. So as states begin spending their stimulus checks from...
After a painful period of price inflation, the cost of concrete, steel and asphalt is dropping. So as states begin spending their stimulus checks from Washington, they'll find they can build and repair more roads and bridges with less money.
Construction costs rose faster than the rate of inflation between 2004 and mid-2008. The trend was driven by a global building boom, especially in countries such as China and India, as well as higher energy costs. The price increases bedeviled transportation planners and embarrassed state and local politicians as road, bridge and rail projects came in way over budget.
Finally, the run-up is over. Thanks to plunging energy prices and the global economic slowdown, the cost of highway and street construction materials dropped by 16 percent over the last three months of 2008, according to an index compiled by Reed Construction Data. Labor and equipment rentals also have become modestly cheaper, further driving down the cost of transportation projects.
Experts expect construction costs to remain roughly stable through the end of this year. It's one upside to the economic forces that currently are decimating state and local budgets, says Jim Haughey, chief economist for Reed Construction Data. "This is a good time to buy stuff.
Join the Discussion
After you comment, click Post. You can enter an anonymous Display Name or connect to a social profile.
LATEST MANAGEMENT & LABOR HEADLINES
States Drop Pay Raises for Medicaid Doctors2 days ago
How Denver's Attracting Top Private-Sector Talent from Places Like Chipotle2 days ago
Michigan Governor Signs Bill Banning Electronic Car Sales3 days ago
Christie Mocks Minimum-Wage Workers' Struggle3 days ago
Judge Reinstates Philadelphia Teacher Contracts, for Now3 days ago
Thousands Protest Canceled Teacher Contracts in Philadelphia1 week ago