Q2 2024 Market Conditions Report

by Phil Bartkowski and Tim Jed

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Our Q2 2024 Market Conditions report summarizes current market conditions, industry trends, and mitigation strategies to make more informed business decisions in the quickly changing construction landscape.

Insights Overview
Industry Insights

Election Year Intensity

Growth in the U.S. economy has dropped to its weakest rate since 2022— according to the Commerce Department’s Gross Domestic Product (GDP), reported by quarter. High interest rates designed to curb inflation just haven’t had the impact as intended. So, what is the Fed doing about it?

Though inflation, as the Fed publishes, has been sloping downward steadily, the focus is now on avoiding a recession. As the GDP scales back and inflation remains high, stability in the market is still yet to be seen.

The fact of the matter is that prices are still high for consumers across the board. In certain sectors and pockets, prices have dropped, but in the building industry the likelihood of seeing pre-pandemic pricing is a long-shot. It would take an extreme turn of the economic tide to see building costs decrease, and that would have a dramatic impact to the industry. We should be looking for stability and regularity as an ideal, hoping to avoid the peaks and valleys. However, no one anticipates a recession.

Historically, according to experts that study the effects of the economy on Presidential elections in the U.S., it is much more difficult to predict who will win the election in 2024 than in the past. Several articles refer to an “Age of Polarization” in the U.S., where people are so focused on party-line voting as the primary driver of a vote that the economy, and other issues, are just not as much of a determining factor.

Two construction workers looking at drawings.

It’s interesting to follow political science professors debate on this topic. Will the economy matter in this election? Generally, the people that research this topic agree that the economy will always be a factor.

History shows that in the four-year Presidential cycle, year four typically experiences a modest pull-back in the markets during the second half of that year. But history would also indicate that, while policies can dramatically affect the economy and our wallets, it is difficult to establish a consensus on whether the key to economic growth lies with voting Republican, Democrat, or Independent. Presidents do not control the economy; there are too many other factors at play to over-simplify it in that way.

Our Federal Government is designed to have checks and balances, and while you might expect that a “sweep” of Democratic or Republican control over the White House and Congress would have the most dramatic impact on the market, the data would indicate that’s not entirely true.

U.S. Bank looked into this topic and developed an overview. The data is pretty clear: a house divided just might be the most economically positive situation for us to look forward to. Food for thought...


Will the economy matter in this election?

ScenarioWhite House ControlCongress ControlOutcomeAvg. 3-mo. S&P 500 ReturnAvg. 3-mo. Return relative to allStatistically Significant
1DemocratDemocratOne Party (D)2.20%+0.02%No
5RepublicanRepublicanOne Party (R)2.67%+0.49%No
All One Party (D or R)2.33%+0.15%No
All Divided2.08%-0.10%No

Source: U.S. Bank Asset Management Group, November 2023

A construction worker carrying drywall within a construction site.
Index Says:

What are the Experts Telling Us?

American Institute of Architects

  • Billings are down. Inquiries and contracts are up.
  • Though the index is below the median in all categories, the amount of inquiries should lead to contracts and, in turn, more billings. This is not ideal, but there is high potential that the index will rise soon.

Cumming Group

  • 2024 construction spending is forecasted to increase in the following regions: Northwest, Southwest, and Central.Conversely, the Northeast and Southeast are expected to decrease in 2024.Moving into 2025, the only markets forecasted to increase from 2024 are Northwest and Southwest.All this information is narrowly changing. Year-over-year, there are no shifts greater than single-digit percentages, regardless of the region’s outlook.

Consumer Pricing Index

  • CPI spiked to 8% in 2022 and now we are down to 4%.Forecasts are looking at a further decrease into the mid-2% range in 2025.If CPI goes down, this could indicate that the economy will grow even further, but with the all-time high inflation and continued consumer spending we are seeing now, the question stands as to whether or not anything will change.

Dodge Construction

  • High interest rates have potentially caught up to the seemingly ever-rising quantity of construction projects breaking ground.
    Non-residential building starts have dropped for the first time in over a year.
  • Less construction starts means there needs to be more balance of project size and scale to keep a healthy pipeline of work. There has been a dramatic increase in private ‘mega-projects’ coming online with budgets well into the billions.
Two workers wearing PPE
Managed Supply Chain
Supply Chain

What Goes Up, Just May Come Down

In March, the Federal Trade Commission said that the three largest food retailers—Kroger, Walmart and Amazon—“accelerated and distorted the negative effects associated with supply chain disruption.” Grocery prices have jumped by 25% in four years, and while retailers have contended that the higher prices merely reflect their greater costs, the FTC found data to the contrary.1

They are not alone. Hershey’s has been raising prices steadily over the last several quarters. They identified cocoa prices as the reason for those increases, caused by heavy rains in West Africa. And while it is true that cocoa hit an all-time high last month and costs 1.5 times what it did a year ago, Hershey’s profits outpaced their cost increases dramatically, to a reported $1.9 billion in net income in 2023, up 62% from 2019.2

But more recently, as Hershey’s has continued to raise prices, sales have started to drop, causing Hershey’s to start to dip into their profits in 2024 to offset some of these increases.3 The Washington Post reported, “In January, markups by the wholesalers and retailers that handle most consumer goods shrank for the fourth consecutive month—the first time that has happened in the 13 years that the government has tracked such figures.”4

These shifts in spending suggest that price increases, at least for certain products, are not being accepted and that the Fed’s interest rate hikes during the past two years are cooling inflation. We’re seeing this in the inflation figures over the last several months, as the rates continue to drop nearer to pre-pandemic levels.

But this may not last. Housing prices are down a bit,5 but Goldman Sachs is predicting a rebound in 2024 due to the anticipated Fed interest rate cuts,6 even as long-term interest rates ticked up slightly in early April to their highest levels since November 2023.7

The unemployment rate remains low—below 4%8—which continues to apply pressure to labor costs. And while the architectural billings decreased again in February, it was the smallest decrease since July 2023. In fact, design contracts are increasing,9 suggesting that additional work is coming.

A chart depicting U.S. annual inflation rates from 2014 to 2024:  0.8, 0.7, 2.1, 1.9, 2.3, 1.4, 7, 6.5, 3.4, 3.2

CHART: Will the economy matter in this election?

Source: https://www.usinflationcalcula...

A construction worker using a tape measure to measure.
Supply Chain

Why Infrastructure Matters

The big news of the first quarter of 2024 was the Francis Scott Key Bridge collapse on March 26. This collapse, like the bridge in Philly that collapsed last year and the boat that got stuck in the Suez Canal, illustrates the fragility and importance of resiliency in our logistics network. This resiliency remains important even as COVID impacts to supply chain have subsided.

According to CNN, Baltimore is the ninth biggest U.S. port for international cargo, and “is also the leading U.S. port for farming and construction machinery, as well as imports of sugar and gypsum, and the second in the country for exporting coal.”10

Sean McNally, VP of Public Affairs and Press Secretary for the American Trucking Associations, said, “nearly 4,900 trucks travel the bridge daily, with $28 billion in goods crossing every year.” He continued, “trucks moving hazardous materials will now be subject to roughly 30 miles of detours around the City of Baltimore because they are prohibited from using the city’s tunnels. This will add significant cost in time, fuel, and delays for trucks traveling through the region, on top of the disruption that a closure of the Port of Baltimore will inflict on our economy.”11

We anticipate that the Port of Baltimore will be open at capacity within weeks as the debris is being removed, but the hazardous cargo will require rerouting until the bridge is rebuilt. In the meantime, expect high prices and delays for cargo that has been redirected to reach the port.

FleetOwner, an online resource for vehicle professionals, recently identified the six biggest vulnerabilities in our trucking industry as:12

Number 1

A troubled infrastructure

This wasn’t the only bridge that has had issues. Last year’s Interstate 95 road collapse in Philadelphia created problems.

Number 2

A shortage of qualified truck drivers

The ATA has estimated a deficit of approximately 64,000 truck drivers. This is expected to double by 2031.

Number 3

Volatility in fuel prices

Fuel prices have varied from a low of $2.36 to a high of $5.81 per gallon over the last four years.

Number 4

Climate change

From rain, floods and snow, to drought and fire, climate change has made deliveries difficult and imposed many delays.

SPOTLIGHT: Climate Change

The Panama Canal will need at least the rest of this year to fully recover from the 2023 drought.13 The canal handles about 40% of all U.S. containers, or about $270 billion in cargo. The current daily volume for the canal is 32 ships per day, down from 38 in 2023.14 Some companies, like Maersk, are now opting for alternate routes.15

The Mississippi River will likely have low water issues again this year, due to dry spring weather and low snowpack, slowing its freight, which accounts for nearly 1 trillion pounds and is a major transportation artery in the US.16 Venezuela is also battling a record number of wildfires caused by climate change-driven drought in the Amazon Rainforest region.17 The drought in Africa has reached crisis levels, impacting Zambia, Malawi, Zimbabwe, Botswana, Angola, Mozambique and Madagascar.18

Number 5

Geopolitical uncertainty

Conflicts throughout the world, from the Middle East, to Ukraine, to the Red Sea Houthi attacks on vessels, have caused huge impacts on the industry.

SPOTLIGHT: Geopolitical

Red Sea Region

The Houthi attacks in the Red Sea, if not abated, could cause a 0.4% dip in the world GDP due to the inflationary impact these attacks could have on oil imports, 30% of which pass through the region.19 The Red Sea, which hosts 19,000 shipping vessels each year, and is the southern entry point to the Suez Canal, is one of the busiest shipping channels in the world. According to Reuters, this entry point accounts for 30% of global container traffic and $1 trillion worth of goods each year, which accounts for 12% of global trade. Rerouting vessels around the Cape of Good Hope can add up to two weeks and between 3,452 and 6,904 miles. The London Stock Exchange Group’s (LSEG) oil and shipping research team calculated that it costs 35% more to traverse the longer route.20

China and Taiwan

China and Taiwan tensions continue. Taiwan is critical due to the world reliance on semiconductors it produces, which has been covered in detail in prior DPR Market Conditions Reports. Further, the Taiwan Strait hosts nearly half of the world’s 5,400 container ships annually.21 China has entered waters Taiwan claims are restricted, and this is being interpreted as China’s attempt to begin to chip away at Taiwan’s jurisdiction. This happened as Taiwan planned to hold military training exercises near a group of islands close to China's shores, to which Beijing warned Taipei not to “stir up trouble.”22 Additionally, in March, Business Insider reported that there was a satellite image captured in December 2022 of a scale model of Taiwan's presidential offices at a desert military training site located in China, presumably to use for training in the event of an invasion of Taiwan by China.23 These developments continue to suggest significant tensions between the two nations that could cause semiconductor and shipping instability.

Israel and Iran

Oil prices have risen more than 18% this year.24,25 In early April, oil prices approached a six-month high after Israel bombed an Iranian consulate. Then, in Mid-April, Iran launched an attack against Israel in response to a suspected Israeli air strike on the Tehran’s embassy in Damascus. On April 18th, Israeli struck back.26 Iran is a key supplier of several rare earth elements, including coal, metallic minerals, sand, gravel, shale, and is the 2nd largest world producer of gypsum, the 8th largest producer of molybdenum (used in specialized steels), the 11th largest iron ore producer, and a significant producer of sulfur.27 If world supply of these is constrained, it could cause pricing fluctuations in related products.

Number 6

Increase in cyberattacks

Telematics, including GPS tracking and onboard diagnostic codes, are vulnerable to cyberattacks. The Lehigh Business Supply Chain Risk Management Index for the second quarter of 2024 shows cybersecurity is the biggest risk on supply chain managers’ minds for the fifth straight quarter. This, along with Generative AI and government intervention/geopolitical issues, round out the top three concerns for 2024.28

However, even with the increased concern over cyber security, the belief continues to grow that blockchain is an important part of our future. According to Fortune Business Insights, it is expected to grow from $17.57 billion in 2023 to $469.49 billion by 2030, likely due to its collaborative, yet trackable and controllable transactions, which can help enable trust and efficiency throughout the supply chain.29

SPOTLIGHT: Cyberattacks

In February, a popular supply chain software by Linux (XZ Utils) was shown to have a security breach that was created when a provider of the open-source code inserted a backdoor that could have been a real problem for the IT industry and customers. Thankfully, before the compromised software could be distributed, this was found and corrected, but this underscores the importance of cybersecurity and the vulnerabilities that exist.30

A worker wearing PPE walks along a jobsite building exterior.
Supply Chain

What’s to Come?

We anticipate we will continue to see supply chain issues, although not to the extent which we experienced during the pandemic. Larry Culp, Chairman and CEO of GE Aerospace, said, “I think we’re making progress, but we just can’t make enough progress.” When speaking of timing, Culp said, “I think we’ve easily got a couple of years that I think we’ll be talking about this.”31

Some feel consumer behavior and the supply chain have changed post-pandemic, putting focus on a new approach. Roger Mayerson, Senior Vice President at AI supply chain planning software company Logility, said a shift in buying behavior, new channels of distribution and changes in online shopping preferences make the old forecasting model obsolete. Brands are finding that the sales data from 2020 to 2022 is producing low-quality forecasts and they need to find a better way to build their demand plans.32

So, supply chain professionals are adapting and applying strategies, tactics, and technologies that will boost productivity, and reduce costs over the long term.

Here are five key trends, according to SupplyChainBrains, that will shape the logistics and supply chain landscape in 2024, and how we apply those approaches in DPR:33

1. Tackling the ongoing labor shortage

At DPR, our self-perform and prefabricated capabilities help position us to better adapt to these challenges we face every day in the construction industry, like low unemployment rate.

2. Keeping an eagle eye on the bottom line

Even though cost matters, it isn’t the only thing that matters. There’s an adage: “Time, quality, price...pick two.” We don’t believe that, but we do recognize it’s a balance. Sometimes paying more for improved schedule makes sense, sometimes it doesn’t. Our approach to evaluation of total cost—finding the perfect balance of quality, cost and time for our customers—sets us apart as a builder of choice.

3. Thinking beyond customer service

DPR is working across our family of companies to help deliver a more complete and positive experience by delivering high-quality projects on time. The supply chain is a big part of the overall experience and offers a resilient network of suppliers with high quality on-time capabilities to ensure product delivery happens. We work to achieve that level of predictability every day.

4. Reinventing business models

One of DPR’s core values, Ever Forward, encourages “continual self-initiated change, improvement, learning and the advancement of standards for their own sake.” This core value is one reason behind our drive to tackle the construction supply chain.

5. Adopting a stronger environmental focus

A national leader in sustainable construction, DPR’s multibillion-dollar portfolio of green buildings is highlighted with hundreds of projects that have achieved industry-leading standards and pushed the boundaries of what levels of high performance can be achieved at market rates. In our supply chain program, we are also putting supplier quality and qualification programs in place to help ensure this exists further upstream in our supply chain, not just for environmental focus, but also for diversity, equity, and inclusion.

Construction site with tower crane surrounded by other buildings.
Supply Chain

Biggest Impacts

These impacts are based on actual communications received from our suppliers and distributors, and may be different than the Market Conditions Dashboard, as this information is based on specific products compared to the general data in the Market Conditions Dashboard.

Impact Cause Action
Domestic Trucking:
Increase of 0% to 1%
1 week lead time, we anticipate that the market will bottom out end of Q2 and then begin to rise.
Spot market rates continue to increase as capacity levels off. National Flatbed rate is currently $2.49 per mile. Continue to look at the spot market to bid the best rates for loads.
Ocean Freight/Containers:
Fell 1% as of February 28, 2024 (a $1,260 increase from March 8, 2023).
Red Sea uncertainty, Panama Canal drought, and inflationary pressures. However, rates are significantly higher than last year.

Asia-US West Coast prices (FBX01 Weekly) fell 2% to $4,809/FEU. This rate is 78% higher than the same time last year.   

Asia-US East Coast prices (FBX03 Weekly) fell 1% to $6,709/FEU. This rate is 65% higher than the same time last year.
Continue to look at the spot market to bid the best rates for ocean freight.
Lead times for passenger elevators from 20 - 26 weeks, for freight elevators 50 - 60+ weeks
Components on elevators remain challenged with delays, with elevator doors exacerbating delays for freight elevators.

Early planning and procurement is highly recommended especially for freight elevators.

Potential Price Increase of 5 - 8%

Increase in demand from advance tech and manufacturing projects coupled with limited production workforce to meet demand.

Early planning and procurement is highly recommended for upcoming projects.
Mechanical Equipment:
Price Increase of 5 - 14%
Continued high demand for equipment juxtaposed with sole source specified project equipment, which limits options for expediting materials, and tight project schedule durations. Early planning and procurement is highly recommended for upcoming projects.
Supply Chain

Mitigation Strategies

While the easing of supply chain issues is positive, DPR has been actively working to control our destiny and prepare for the future in managing our supply chain. We aim to ensure a reliable supply chain that keeps our projects on track, hitting critical milestones, and minimizing the effect of outside events.

Strategic Sourcing

We recently deployed our strategic sourcing abilities to help a DPR client find alternative solutions for a custom transformer replacement request on one of their projects in Malaysia. Working with the client, the team collectively reduced the lead time from six months to three months.

Why this matters: DPR is a global company with resources and abilities to support your project needs with national and international solutions.

Innovating for Quality & Efficiency

Innovating for Quality & Efficiency
DPR Material Supplier Quality Management is advancing processes around material supplier quality and for certain categories of products

Why this matters: This risk-based assessment and data-driven approach to material quality due diligence enables confidence in considering alternatives. This, in turn, can allow for buying in bulk, which lowers cost and increases influence over the supply chain schedule.

Leveraging Supplier Relationships

Through our partnership with elevator manufacturers, we were able to help two projects in Colorado resolve delays on the job related to coordination and missing components, cutting the delay by up to 5 weeks.

Why this matters: In a market with many unknown delays impacting projects, having the right strategic partnership can greatly reduce the unknowns and their impacts.

Collaborative Procurement

At DPR, we are enhancing our procurement process for a fuller end-to-end approach. In one recent example, our team worked with a supplier to improve the efficiency and timing of the billing and payment process, which reduced the cycle timelines.

Why this matters: By streamlining our approach, we can reduce payment cycle times, continue our positive supplier relationships, and gain more favorable pricing in the future.

Design Build

Electrical Procurement

With increasing demand for data centers, long lead times on electrical gear continue to pose problems. DPR is working with manufacturers who can offer smart solutions that fit the needs of clients and meet the project schedule. Recently, our team provided a solution with half the typical lead times—40 weeks, compared to a typical 80 weeks.

Why this matters: By offering innovative solutions, we can overcome supply chain challenges with electrical gear and execute projects faster.

Mechanical Procurement

Mechanical equipment lead times are getting better, with the exception of certain vendors. As project durations shorten, there is a demand for faster purchase of equipment. On a recent pursuit, we identified and offered eight different solutions, which enabled the project team to move forward with the most rapid and cost-effective solution.

Why this matters: Having a wide range of vendor relationships enables us to offer a variety of solutions based on project needs.

Trends By Industry

By Industry

Life Sciences

Life Science Trends

Is the Life Science Industry poised for growth in 2024? We are optimistic


Healthcare Trends

Evolving with customers as healthcare is redefined in 2024 and beyond


Commercial Trends

Generally, CRE investors continue to subscribe to the mantra of “Stay Alive Until ‘25”

Higher Education

Higher Ed Trends

Despite turmoil and controversy dominating headlines, innovation and adaptation continue

Advanced Technology

Advanced Tech Trends

Advanced Manufacturing and Mission Critical sectors in the U.S. are in a construction boom

Links and Resources
Links and


laptop graphic of dashboard

Past data reflects the movement of PPI indices, as provided by the US Bureau of Labor and Statistics and is captured and updated monthly.

Future forecast data is gathered through DPR’s Supplier Relationship Management Program in coordination with leading industry manufacturers and suppliers. Forecasted data is captured and modeled quarterly as an average of several surveys to multiple suppliers within the trade.

Report pages

Download a copy of the report in PDF format. 


1 Trade watchdog: Big retailers used supply-chain problems to inflate grocery costs (
As Hershey battles cocoa costs, chocolate lovers may help cool inflation (
As Hershey battles cocoa costs, chocolate lovers may help cool inflation (
Despite rising chocolate prices, shoppers help bring down inflation - The Washington Post
Housing Market Update: Home Prices Fall Annually For First Time in a Decade As Mortgage Rates Pass 7% (
US home prices forecast to climb as mortgage rates fall to 6.3% in 2024 (
Long-Term Interest Rates Touch Highest Levels Since November (
Civilian unemployment rate (
Architectural Firms See Glimmers of Business Hope in AIA Billings Index | Engineering News-Record (
(25) Port of Baltimore closure could cause traffic tie-ups and higher shipping prices (
How Baltimore’s Francis Scott Key Bridge collapse affects truck traffic and fleet operations | FleetOwner
Trucking challenges amid supply chain vulnerabilities around the Francis Scott Key Bridge tragedy | FleetOwner
Panama Canal Will Need Rest of Year to Recover From Drought - Bloomberg
Panama Canal Data for Current Operations (
Panama Canal Drought Could Hit U.S. Trade Hard | Shale Magazine
Drought Threatens to Snarl Mississippi River Traffic Again | Transport Topics (
Venezuela battles record wildfires worsened by Amazon drought | CNN
Extreme drought in southern Africa leaves millions hungry (
Economic Slump Ahead If Houthi Red Sea Attacks Don’t Stop, Report Says (
How the Red Sea crisis is disrupting the supply chain - Kansas City Business Journal (
Map Shows Why Taiwan Is So Important to the World (
China Doubles Down on Friction in Taiwan’s Front-Line Islands (
China built a mock-up of key area in Taiwan’s capital city at a desert training site, satellite images show (
Oil prices - Search (
Oil prices are near a six-month high after Israel bombed an Iranian consulate (
Iran and Israel’s open warfare after decades of shadow war (
Mining in Iran - Wikipedia
Generative AI becoming a concern for supply chain managers (
Why Blockchain Technology Is the Future of Supply Chain and Vendor Management | Nasdaq
Supply Chain Attack: Major Linux Distributions Impacted by XZ Utils Backdoor - SecurityWeek
Daily Memo: GE Aerospace Chief Sees No Quick Fixes For Supply Chain Woes | Aviation Week Network
AI’s Role in Overcoming Post-pandemic Supply Chain Challenges (
Five Trends That Will Drive Supply Chain Success in 2024 | SupplyChainBrain

Photos: Bill Michie, Aaron Yang, and Danny Sandler.

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