Latvia Construction Costs 3rd quarter 2007

Well there isn't that much evidence of a slow-down in the inflationary spiral in this latest release from Latvijas Statistika.

Year on year construction costs in Latvia in the 3rd quarter of 2007 rose on average by 23.8%, according to the Central Statistical Bureau. The most rapid rise (by 40.4%) could be seen in the labour remuneration of workers. The maintenance and operational costs of machinery and equipment increased by 34.4% and the prices of construction materials rose by 10.1%.

The most notable increases in construction costs were in the renovation of office buildings, in the reconstruction and construction of education, healthcare and sports buildings (by 31.6% and 31.5%, respectively). Costs in the construction of residential buildings increased by 24.8%, in the construction of transport facilities - by 21.9%, in the construction of underground main pipelines - by 19.4%, in the reconstruction and construction of industrial, agricultural and trade buildings - by 19.1%.

Compared to the 2nd quarter, in the 3rd quarter construction costs on average increased by 3.7%. The maintenance and operational costs of machinery and equipment increased by 7.0%, the labour remuneration of workers – by 6.0% and the prices of construction materials – by 0.9%. The most notable increases in construction costs were in the construction of underground main pipelines – by 4.9%, in the renovation of office buildings – by 4.7%, in the reconstruction and construction of education, healthcare and sports buildings - by 4.0%. Costs in the construction of residential buildings increased by 3.7%, in the construction of transport facilities - by 3.4%, as well as in the reconstruction and construction of industrial, agricultural and trade buildings - by 3.0%.

So in the 3rd quarter wages of construction workers were still increasing at an annual rate of 24%. This is slowing but it is still very, very large.