Construction Costs Soar In 2008

The cost of building or improving roads and bridges is rising dramatically in the Louisville region and the rest of the country. That’s according to a report from the Associated General Contractors of America. Association chief economist Ken Simonson says jumps in the price of diesel, steel and asphalt are making all commercial construction more expensive, especially bridges and highways.

In the last four months, average asphalt prices have risen more than 40% while steel has gone up about 26%.

But Simonson says probably the most painful increase for builders is the nearly 20% hike in diesel fuel prices.

“That effects construction even more than most industries because contractors use diesel for their off-road equipment such as earth-moving machinery, for dump trucks, concrete mixers and pumpers and other construction vehicles,” he says.

Simonson blames the jump in steel prices partially on increased demand for projects in the Middle East, India and China.