Despite dropping again in December, construction material prices still cutting into contractor earnings

The amount contractors pay for a range of key construction materials edged down 0.2 percent in December but climbed 5.3 percent from a year earlier, according to an analysis of producer price index figures released, Jan. 18, by the Associated General Contractors of America. Meanwhile, the amount contractors charge to construct projects remained largely flat for the month and is up only between 3.3 and 4.7 percent for the year, cutting into contractor earnings and adding to the challenges the hard-hit industry is facing, association officials said, in a release.

“Any relief contractors might get from the recent declines in materials prices is being offset by their inability to increase prices for new construction projects,” said Ken Simonson, the association’s chief economist, in the release.

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