NEW YORK, Aug. 27, 2024 /PRNewswire/ — Skanska, a leading global construction and development firm, announced the release of the company’s Summer 2024 Construction Market Trends Report. The in-depth report covers supply pricing, industry labor shortages, and forecasts escalating construction costs across the country in the near- and long-term, with some surprising results.
Skanska’s work in various sectors across the country provides a unique perspective on these trends and what’s to come in 2025:
- In their Market Sector Overview, nearly all markets will continue to invest in healthcare, higher education, aviation hubs, and science & technology centers, despite the “uneven” state of supply chains.
- Of the markets reported, Orlando was the strongest, with several large projects wrapping up this year, including a new park for Universal Studios and plans to invest several billion into Disney World over the coming years.
- DC was among the most strained markets currently and in the next several years, with a stagnant office market, and many projects working with longer timelines and contingent on falling rates over time.
- Portland, on the other hand, was among the most consistent cities like DC, but for different reasons: the volume of new opportunities for high tech, transportation, and education has dramatically increased. However, while competition is higher, fees and bids for projects remain steady.
“We are pleased to see a major surge in both public infrastructure work and the implementation of electrification and decarbonization initiatives across the country,” said Steve Stouthamer, Executive Vice President of Project Planning at Skanska USA Building. “Skanska continues to innovate with new technologies and sustainable solutions, and we look forward to seeing even wider adoption of these practices across the country through information-sharing like in our Summer 2024 Construction Market Trends Report.”
Skanska is hosting a webinar on August 28th to detail the latest trends in the science and technology market, such as the rapid evolution of semiconductors, labs and research facilities, data centers, and other high-tech projects, as well as insights into risk mitigation strategies.
“I’m looking forward to discussing and sharing Skanska’s collective insights with a wide audience on the newest trends in the science and technology market during the 2024 Summer Market Trends Webinar,” said Tom Park, Vice President of Strategic Supply Chain at Skanska USA Building. “With $4.3 billion of science and technology projects currently in progress, I anticipate a timely and inspiring conversation that will cover everything needed to develop successful communities across the pharmaceutical, biotech, academic, government, chemical, high-tech, and medical device industries.”
Additional takeaways from the Summer 2024 Construction Market Trends Report:
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Construction and Labor:
- Construction unemployment remains unchanged from one year prior, at 3.9% for July.
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Architecture Billings Index:
- In June 2024, billings at firms decreased for the seventeenth consecutive month, with an ABI score of 46.4 (a score below 50 indicates that billings declined).
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Commodities and Materials Pricing:
- Pricing for aluminum, zinc, and nickel retreated as supply stabilized and demand softened, while copper prices continued to retreat from an all-time high in May as inventory levels grew.
- Fuel prices have climbed alongside summer travel.
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Construction Cost Indices:
- Both of ENR’s core construction indices have remained below the 3 – 3.5 percent historical, annualized escalation trend for the past 12 months. However, regional markets are seeing varied escalation rates, primarily in the MEP trades due to the scale of High Tech and Data Center work that is ongoing.
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Supply Chain Trends:
- For several quarters, Skanska has reported the unevenness of supply chain recovery since the pandemic.
- Most supply chains have recovered with lead times back to pre-pandemic levels and escalation rates back to 2 – 4 percent.
- The exception to this is mechanical and electrical equipment, which still suffers from historically high lead times and higher-than-average escalation.
Learn more about Skanska’s science and technology work here.
About Skanska
Skanska uses knowledge and foresight to shape the way people live, work, and connect. More than 135 years in the making, we’re one of the world’s largest development and construction companies. We operate in select markets throughout the Nordics, Europe, and the United States. Skanska in the U.S. is headquartered in New York City with 28 offices around the country. In 2023, construction in the U.S. generated $7.1 billion in revenue, and as a developer in the U.S., Skanska has invested a total of $4.6 billion in commercial and multi-family projects. Together with our customers and the collective expertise of our 6,500 teammates in the U.S. and 27,000 globally, we create innovative and sustainable solutions that support healthy living beyond our lifetime.
