A national measure of nonresidential construction activity declined in the third quarter compared to the second quarter as rising costs took a toll.
That’s according to the recently released “2014 Third Quarter Nonresidential Construction Index (NRCI)” from FMI Corp., a provider of management consulting and investment banking to the engineering and construction industry.
The NRCI declined 3.3 points to 62.5 in the third quarter, from 65.8 in the second quarter, but is still above the 60.3 reading in the year-ago period. The cost of materials and labor continues to climb, weighing negatively on the index., according to an FMI news release.
Other factors keeping the NRCI from rising are governments continuing to reduce spending and avoiding making final decisions on the highway bills, as well as private investors taking a passive role, waiting for others to act first, FMI contends in its release.
Despite that, the NRCI is “still solidly in the growth range” between a reading of 50 and 100, FMI said.
The “good news” is that the economy has passed the “survival” stage and currently occupies the “thriving” phase, FMI contended. Backlogs remain strong with expectations of improvement and productivity is up slightly.
The full report is available at: http://hosting.fyleio.com/21574/public/FMI_Studies_and_Reports_/NRCI_3RDQ_2014_FINAL.pdf
