Skanska Reports Construction Opportunities and Obstacles

Global construction and development company Skanska, has released a market trends report that identifies data centres and electric vehicle plants as growth areas but that also highlights “uneven” supply chains and labour shortages as notable issues. 

Skanska’s Summer 2024 Construction Market Trends Report, offers insights into the current state of the US industry.

It details hot US markets and emerging sectors, and provides a comprehensive overview of the construction landscape.

It also highlights challenges, such as uneven supply chains and market fluctuations.

Uneven supply chains refer to inconsistent:

• Availability
• Lead times 
• Pricing of materials and equipment across different sectors, causing challenges in procurement and project planning.

Skanska’s analysis serves as a resource for industry professionals seeking to understand and capitalise on current market trends.

Skanska's key insights on trends and forecasts for 2025

Despite global economic uncertainties, Skanska highlights several positive developments in the construction industry:

• Hot markets: Certain sectors, such as data centres, life sciences facilities and electric vehicle battery plants, are experiencing significant growth.

• Supply chain improvements: While some materials remain challenging to price, like copper that is retreating as inventory levels grow, overall supply chain issues are showing signs of stabilisation.
• Labour shortages: The industry continues to grapple with workforce challenges, prompting Skanska to focus on talent retention and development.

The says that despite supply chain problems healthcare, higher education, aviation and science and technology sectors continue to attract investment.

In terms of regional construction health,Orlando emerges as the strongest market, buoyed by major theme park developments like Universal Studios.

Portland is also seeing a surge in high-tech, transportation and education opportunities. 

By contrast, the office market in Washington DC is stagnant and seeing extended project timelines.

Skanska’s material breakdown

Within the report, Skanska breaks down the widely varying pricing of various construction materials in the US. These include:

Asphalt - levels are stable with expected increase in pricing as road infrastructure projects demand increase.
Concrete and cement - prices rising.
Drywall, gypsum and insulation - drywall pricing increased but availability remains stable. Insulation prices are also rising with demand, particularly around mineral wool.
Lumber and wood - lumber pricing remains at the bottom of the market and pricing is expected to stay low.

Metals - pricing of zinc, nickel and aluminium retreated as demand eased and supply stabilised, yet copper prices continued to retreat.
Fuels and natural gas - alongside summer travelling, fuel prices have increased. However, regarding raw crude oil, OPEC, the global oil cartel, sets crude oil production quotas for each country and these quotas fluctuate, resulting in artificially driven higher prices. 
Piping - PVC pipe prices are stable due to low residential demand. Copper prices are rising, however, ductile iron prices fell due to reduced commercial demand and a strong supply of pipe and raw steel and pipe.
​​​​​​​Structural steel inputs - pricing is down due to declining scrap prices and easing demand. It is estimated that the pricing will continue to soften.

Steve Stouthamer, Executive VP of Project Planning at Skanska USA Building, says: "We are pleased to see a major surge in both public infrastructure work and the implementation of electrification and decarbonization initiatives across the country.

"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."

Tom Park, VP of Strategic Supply Chain at Skanska USA Building, adds: "With US$4.3bn 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."

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