Construction Cost Index
(JANUARY 2009 = 100)
Nonresidential construction costs increased 2.6 percent year-over-year in Milwaukee and 2.1 percent nationally. The Milwaukee index is 3 points below our our national index.
(an indicator of future wage and activity trends)
Despite disruption caused by the COVID-19 pandemic in 2020, year-over-year construction employment growth in the Milwaukee area increased 2% overall, driven by a continuation of activity underway in the market.
Building Component Trends
(Q4 2020 vs. Q3 2020)
• Reinforcing Steel Material (10.3%)
• Site Utilities (10.0%)
• Roofing System (10.0%)
• Preformed Metal Wall Panels (5.6%)
• Steel/Metal Decking Material (4.2%)
• Electrical Systems (3.8%)
• Plumbing Systems (2.0%)
• Metal Stair Fabrication (2.0%)
• Cast-In-Place Concrete (1.5%)
• HVAC Systems (1.5%)
•Resilient Flooring & Carpeting (1.0%)
• Finish Carpentry & Arch. Millwork
• Entrances & Storefronts
• Electric Traction Elevators
• Steel Framing & Stair Erection
• Fire Protection Systems (-6.8%)
• Deck Formwork (-5.4%)
• Gypsum Board Systems (-3.5%)
Note: All other components (14% of the index) were flat.
Eleven components of the Milwaukee index increased in the past quarter, most notably for reinforcing steel material, site utilities, and roofing systems. Costs decreased for three building components.
Advice for Building Owners
Our Milwaukee construction cost index increased 2.6 percent overall in 2020. Downward pressure continues as some trade contractors and suppliers work to rebuild their backlogs. However, due to pandemic-related disruptions to supply chains we are seeing significant increases for PVC, steel, copper, lumber and glass. This, together with losses in productivity due to ongoing COVID-19-related procedures will offset much of the downward pressure in the market. We recommend planning for project costs to increase 3% in 2021.
About this report: The Mortenson Construction cost index is calculated quarterly by pricing a representative non-residential construction project in Milwaukee and other geographies throughout the country. Local employment figures are from the Bureau of Labor Statistics.
For a more specific update or questions regarding this report, please contact:
Director of Project Development