Total prices for construction materials rose 1.2% in August on a monthly basis, according to the producer price index recently released by the US Bureau of Labor Statistics. Year-on-year, prices increased by 8.9%. Non-residential building materials saw an almost identical price trend, up 1.2% for the month and 8.8% for the year.
“As companies pay more to deal with labor shortages and material prices continue to rise, they are caught between pricing themselves out of the market or running jobs at a loss,” Jeffrey D. Shoaf, executive director of the Associated General Contractors of America, said in a statement. “Rising material prices and a lack of real federal commitment to construction workforce development are acting as a drag on economic activity that, if not addressed, could have significant consequences for the broader economy.”
Price increases remain higher among materials affected by tariffs and the conflict in Iran. Since August 2025, the prices of copper wires and cables have increased by 27.2%, while the prices of steel products have increased by 23.4%. Crude oil experienced the largest annual increase, at a rate of 34.9%.
Anirban Basu, chief economist at Associated Builders and Contractors, noted in a press release that according to ABC’s construction confidence index, contractors remain generally optimistic. However, he added: “The ongoing escalation in input prices is likely to weigh on profitability in the coming months. This is especially true given the recent escalation in the trade war with Canada and the fact that oil prices have risen above $100 a barrel.”
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