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Vermeulens Releases Q4-2021 Market Outlook

Published 3/7/2022

Vermeulens has released its market outlook report for the fourth quarter of 2021. Key points include:

  • Construction prices rose in Q4 2021 at 0.5% per month, with many projects experiencing spikes in various trades of an additional 5%.
  • Supply chain shortages, labor shortages, and increased backlogs are impacting bottom-line construction costs. We recommend budgeting a bidding contingency in the order of 5% percent in addition to the 0.5% escalation figures.
  • Fed Watch: The Federal Reserve has reached another historic turning point and will be tapering quantitative measures and increasing interest rates this year.
  • Architectural billings continued to grow in Q4 despite lower growth in inquiries and contracts.
  • Construction Dollar Volume: Residential construction continues to boom, reaching new highs in Q4. Non-residential construction is up 3.1% annually, improving 4.93% in Q4, while infrastructure spending increased 2.93% this quarter. 
  • Construction Job Growth: Approximately 101,000 construction jobs were added in Q4, or +1.35%. Construction employment is now only 1.15% below pre-pandemic levels.
  • New York Stock Exchange price index growth moderated but reached new highs. Overall, the NYSE is up 6% from September 2021.
  • Growth in Employment: Monthly average job growth through Q4 was 365,000, with most of the increase in October. 
  • Gross Domestic Product: GDP grew at an annualized rate of 6.72% for Q4 2021.
  • Commodities continue to put cost pressure on prices across the board.
  • Personal Consumption Expenditures (PCE) price index increased 4.7% year over year (October 20 - October 21) prompting the Fed to begin to pull back on stimulative monetary measures.

The complete Market Outlook Q4-2021 report is available from Vermeulens.

Organization Project Role
Construction Cost Consultant and Market Analyst