Evening star., 1939-05-05
Lower Construction
Costs During 1888
Cited by Review
Slow Decline Reported
After Record Set in
October, 1887
Special Dispatch to The Star.


NEW YORK, May 5.-Construc-
ton costs during 1888 were on the
whole lower than in 1887, accord
ing to the annual report of con-
struction cost data just published
by Engineering News-Record.
Total volume of work was greater
and costs were more steady, leveling
off after the sustained rise that be-
gan in 1882. The E. N. r. conStruc-
ton cost index shows that an all
time peak in costs was reached in
October, 1887, after which slow
decline occurred, stretching through
out the first half of 1885, A reduc-
ton in steel prices, huctuating lum-
ber prices and small increases in
wage rates brought the index to
23489 at the end of December
which compared with 24l.05 II
months earlier.
In the companion E. N. R. build
ing cost index, where skilled labor
instead of common labor costs are
reflected, a similar drop occurred
so that December, 1888, was 1867
compared to 20O45 for December,
1887. The changes in both indexes
resulted from the fact that reduc-
tions in the materials components
exceeded increases in labor 'ates.
Wages More Stable.
Wage rate increases for the most
part occurred early in the year,
after which relatively steady condi-
tions prevailed. For unskilled work.
ers the average rate paid in 20 rep
resentative cities was 67.8 cents per
hour, compared with 64.5 cents dur
ing the previous year. Comparable
rates for skilled workers were $1.41
against $132. These are yearly av-
erages. OF more concern to cur
rent construction are the rates at
the end of the year, which stood
at record high levels-68.2 cents for
unskilled and SLAB for skilled.
Prices of basic construction ma
terials held remarkably steady dur
ing 1898, according to Engineering
News Records analysis. Structural
steel shapes at Pittsburgh averaged
$2.18 per hundred pounds for the
year. due to a drop from S225 to
$210 in July. The years average
was 3 cents below 1887. Lumber
fuctuated somewhat throughout the
year, and the average price of $3051
per 1000 feet board measure fol
by 4 inch fir and pine in the &c
cities showed a 13 per cent dror
from the 1887 average of $35.l1
Common brick prices at New York
rose from an average of $3.50 pei
thousand in 1887 to $3.50.
Cement Prices Up.
Cement was another one of the
four basic commodities to show q
price increase, rising in the New
York market from an average OF
S2.07 per barrel in 1887 to $212 ir
1898. During the year the price OF
cement varied from $205 in Janu-
ary to S195 in July, to $3.50 in
August, to $2.15 in December. This
is exclusive of bag costs.
Another element of construction
costs revealed by the Engineering
News Record analysis is the cost OF
financing. Municipalities seeking
funds through bond issues have en-
joyed the lowest interest rates in
history. During 1888 the average
yield for high-grade municipal
bonds was 29l per cent. Industrial
companies and utilities, however
had to pay more for the use OF
money in 1888 than in 1887, although
about the same rate prevailed as in
the 1929 period, namely about 8
per cent.
Another cost factor, particularly
important to contractors, is the in
terest rate charged customers by
banks in the principal cities. En-
gineering News Record reports that
such domestic money rates continue
to be lowest in New York City and
highest in Southern and Western
cities, although all rates are con-
siderably below the 20-year record.