Costs of construction essentials, such as labor and materials, across all building types (residential, commercial and agricultural) remained inflated during Q2 22 throughout the US and Canada.

Highlights of Construction Costs in Q2 22

  • Residential reconstruction costs increased +12% y/y in the US and over +6% y/y in Canada.
  • Most of these cost hikes occurred between Q2 21 – Q3 21.
  • Building permits in the US increased +7% y/y in March 2022.
  • Building permits for 5+ housing units increased +36% y/y.


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Economic Indicators

With significant disruptions to the US economy over the course of the pandemic, home prices have skyrocketed.  Prices of existing homes have soared +18% and prices of new home stock have increased +19%.

Take a look at some key economic indicators by quarterly comparisons.

(All data presented here has been sourced from the US Bureau of the Census, National Association of Realtors, US Bureau of Labor Statistics, The Conference Board, Freddie Mac and CoreLogic.)

                                          Q4 21                 Q1 22

Housing Starts                     1,870                  1,753

Building Permits                   1,752                  1,878

Home Sales                          6,967                  6,878

         New                            764                     814

         Existing                       6,203                  6,083

Consumer Confidence            112.9                  108.1

30-Year Fixed Mortgage Rate   3.1%                   3.8%

                                             Q1 21                 Q1 22

Home Price Y/Y Change

         New                             2.4%                 18.1%

         Existing                       11.1%                 20.9%

Changes in Individual Material Costs Since Beginning of Pandemic

Costs for many individual building materials have continued to surge in both the US and Canada since the onslaught of the COVID pandemic.  Strong demand and supply shortages for those materials have kept costs high to this day.  For example, PVS has seen a significant cost increase of between 100% – 200% across the US and Canada because of its petroleum base used in manufacturing.

Take a look at some of essential material cost comparisons from March 2020 to March 2022, according to CoreLogic:

Material                               US              Canada

Copper Wire                         +160%       +130%

Plywood                               +116%       +86%

Lumber                                 +106%       +100%

Copper Pipe                           +83%         +52%

Steel Stud                              +74%         +51%

Asphalt Shingles                      +14%         +12%

Comparison of Labor Costs in US & Canada

Skilled labor costs in the US have soared significantly from March 2020 to March 2022.  Labor cost growth in Canada has and remains relatively more stable.  Check out just a few of job categories to compare labor cost growth in the US and Canada from data provided by CoreLogic: 

Job Category                   US                           Canada

Teamster                        +14%                        +5.75%

Operating Engineer          +10.5%                      +4%

Roofer                             +9%                           +4%

Tile Setter                        +9%                           +5%

Painter                             +8.1%                         +3.9%

Electrician                         +8%                           +4.2%

Laborer                             +8%                           +3.75%

Plumber                            +7.8%                         +5.2%

Carpenter                           +7%                           +4%

Construction Job Growth in US

US employment in construction totaled 7,628,000 in March 2022.

Employment in 3/2022      Most Growth        Largest Decline

Total – 7,628,000             Idaho – +13%       PA- -7%

+68,000 q/q                   Montana – +12%   New York – -7%

+220,000 y/y                 Utah – +12%        N. Dakota – -6%

Thanks to CoreLogic.

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