Residential and Nonresidential Construction Input Prices Decline in November

Analysis of the U.S. Bureau of Labor Statistic (BLS) Producer Price Index (PPI) data, provided by the Associated Builders and Contractors (ABC) reveals that construction input prices fell -0.5% in November, when compared to those in October. Nonresidential construction input prices fell -0.4% for the month of November, as well. ABC is reporting that year-over-year construction input prices have increased 0.9%, with nonresidential construction input prices up just over 0.3%. In a statement prepared for the news release, ABC Chief Economist Anirban Basu, said “There are now signs, however, that the pace of economic recovery in the United States and in many other parts of the world has slowed meaningfully,” said Basu. “Employment growth has stagnated. The November reading of ABC’s Construction Backlog Indicator was the lowest level since the beginning of 2011. Further slowing is likely due to spiking infection rates among many nations. In the near-term, this will likely dampen the pace of input price inflation. There are also seasonal factors at work, as the winter months tend to be associated with reduced construction spending volumes.