Wage pressure led the construction price index to rise again in the third quarter

News
Posted on 23 October 2023, 8:00

According to Statistics Estonia, in the third quarter of 2023, the construction price index increased by 0.3% compared with the second quarter and by 3.2% compared with the same time last year.

The construction price index expresses the change in construction expenditures taking into consideration the price changes of three basic inputs: labour force, building machines, and building materials. The calculation of the construction price index covers four groups of buildings: detached houses, blocks of flats, industrial buildings, and office buildings. The repair and reconstruction work price index covers office buildings.

Ülo Paulus, leading analyst at Statistics Estonia, said that in the third quarter of this year, compared with the third quarter of 2022, the construction price index was primarily influenced by the increase in construction workers' wages, which accounted for 42% of the total index rise. “Compared with the second quarter of 2023, labour force was 1.7% more expensive and the cost of using building machines rose by 0.4%, while the price of building materials fell by 0.4%,” added Paulus. In addition to the fall in the prices of wood and metal and products made of these materials, prices of autoclaved aerated concrete and plastic products also declined.

The repair and reconstruction work price index rose by 0.7% compared with the second quarter of 2023 and by 3.8% compared with the third quarter of last year.

Quarterly change in the construction price index and its components compared to previous quarter, 2018–2023
Change in the construction price index, 3rd quarter 2023

 

2nd quarter 2023 –
3rd quarter 2023, %

3rd quarter 2022 –
3rd quarter 2023, %

TOTAL

0.3

3.2

labour force

1.7

6.1

building machines

0.4

10.0

building materials

-0.4

1.2

Index of detached houses

-0.4

3.5

Index of blocks of flats

0.5

1.8

Index of industrial buildings

0.3

4.4

Index of office buildings

0.4

2.7

Change in the repair and reconstruction work price index, 3rd quarter 2023
  2nd quarter 2023 –
3rd quarter 2023, %
3rd quarter 2022 –
3rd quarter 2023, %
TOTAL 0.7 3.8
labour force 1.4 5.4
building machines -2.1 6.8
building materials 0.3 2.3

Statistics Estonia collects and analyses data for the construction price index for the Ministry of Economic Affairs and Communications to understand how the Estonian economy is doing.

See also the dedicated section on prices.

When using Statistics Estonia’s data and graphs, please indicate the source.

For further information:

Helen Maria Raadik
Media Relations Manager
Marketing and Dissemination Department
Statistics Estonia
Tel +372 625 9181
press [at] stat.ee (press[at]stat[dot]ee)

Photo: Shutterstock

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