19 December 2018

2018- n° 328
In Q3 2018, producer costs for construction increased (+0.9%) Costs of production indices in construction - third quarter 2018

In Q3 2018, producer costs for construction increased (+0.9% as in the previous quarter). They increased in all sub-sectors, more in civil engineering (+2.2% after +1.8%) than in building construction (+0.5% after +0.7%) and than in specialised construction works (+0.7% as in Q2 2018). Over a year, these costs accelerated (+3.7% after +3.0% in Q2 2018), particularly in civil engineering (+7.3% after +4.9%) and to a lesser extent in specialised construction works (+3.1% after +2.6%) and in building construction (+3.0% after +2.6%).

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Materials cost continued to grow in civil engineering

In Q3 2018, the cost of materials increased again in civil engineering: +4.6% (after +3.4%) due to the strong progression in bitumen prices. On the other hand, the cost was stable in specialised works for civil engineering (after +0.6%) and almost unchanged in building construction (−0.1% after +0.6%).

Over a year, materials cost accelerated sharply in civil engineering (+12.9% after +7.7%) and remained dynamic in building construction (+3.0% as in Q2 2018).

Energy cost rose

In Q3 2018, the cost of energy slowed down in building construction (+1.4% after +4.4%) and in public works (+1.6% after +3.5%).

Over a year, the cost accelerated again, in public works (+22.1% after +18.4%) as well as in building construction (+22.0% after +18.5%) due to an important growth in prices of gas oil.

tableauTable1 – Variations in producer cost indices for construction

In %

Variations in producer cost indices for construction (In %)
Heading	Weights (in %)	Q3 2018/ Q2 2018	Q3 2018/ Q3 2017
F Construction	100.0	+0.9	+3.7
41.2 Construction of buildings	10.2	+0.5	+3.0
42 Civil engineering	15.9	+2.2	+7.3
43 Specialised construction works	73.9	+0.7	+3.1
43BT Buildings	65.2	+0.7	+3.0
43BTC New buildings	24.7	+0.5	+3.0
43BTR Existing buildings	40.5	+0.8	+3.0
43TP Specialised works for civil engineering	8.7	+0.5	+3.7
Buildings (41.2 + 43BT)	75.4	+0.6	+2.9
Public works (42 + 43TP)	24.6	+1.6	+6.0

Source: INSEE

tableauTable2 – Items of producer cost indices for construction

In %

Items of producer cost indices for construction (In %)
Costs	items	Q3 2018/ Q2 2018	Q3 2018/ Q3 2017
Equipment	Buildings	+1.4	+0.7
	Public works	+0.2	+0.9
Labour	Labour costs in construction	+0.7	+3.2
Energy	Buildings	+1.4	+22.0
	Public works	+1.6	+22.1
Materials	Construction of buildings	-0.1	+3.0
	Existing buildings	0.0	+2.6
	Civil engineering	+4.6	+12.9
	Specialised works for civil engineering	0.0	+2.6

Source: INSEE

graphiqueGraph1 – Production costs in construction

Equipment cost increased

In Q3 2018, equipment cost rebounded in building construction (+1.4% after −0.9% in Q2 2018; +0.7% after −0.8% yoy). In public works, it slightly increased by 0.2% (after +0.3% in Q2 2018) and it accelerated over a year (+0.9% after +0.2%).