Civil construction costs decelerate, though rise 0.25% in April

Section: Economic Statistics | Cristiane Crelier

May 08, 2020 09h00 AM | Last Updated: May 08, 2020 11h16 AM

Construction costs per square meter stayed at R$1,172.05 in April - Photo: Helena Pontes/IBGE News Agency

Released today (8) by the IBGE, the National Index of Civil Construction - Sinapi increased 0.25% in April, though it remained below that registered in March (0.35%), even with the adjustment of professional categories in some places. The increase in the costs of the sector has been decelerating since January, when the cumulative rates since January are compared to those in 2019.

From January to April, the index accrued a rise of 1.15%, against 1.50% in the same period of 2019. The rate adds up to 3.68% in the last 12 months, standing below the index of 3.77% recorded in the 12 immediately previous months. The rate had been 0.34% in April 2019.

"Since the beginning of 2020, we have noticed lower cumulative monthly changes than in the last year, reflecting a downturn in the civil construction sector. Some works were expected to be resumed, which did not happen", assesses Augusto Oliveira, manager of the survey.

In April 2020, the material cost slightly changed (0.09%), dropping both in relation to the previous month (0.20%) and in relation to April 2019 (0.33%). The rise of the overall index was mainly impacted by cost of labor force (0.42%), which weighted nearly 40% in the total index.

"In Rio de Janeiro, the professional category was adjusted by nearly 4%, as agreed last year. According to union of workers in civil construction, the payment of such adjustment was postponed up to July. In July, all the enterprise will have to pay it retroactively. As a result, this cost is already included in Sinapi this month, since many companies decided to pay it now," explains Oliveira.

He stresses that the Southeast posted the highest regional change in April (0.39%). The other regions recorded the following figures: 0.00% (North), 0.24% (Northeast), 0.15% (South) and 0.03% (Central-West).

The national cost of construction, by square meter, changed to R$1,172.05 in April, being R$614.38 relative to material and R$557.67, to labor force. The regional costs per square meter were R$1,179.66 in the North, R$1,086.49 in the Northeast, R$1,221.51 in the Southeast, R$1,228.32 in the South and R$1,175.84 in the Central-West.

Due to the measures of social distancing as a result of the Covid-19, April was the first month in which this survey was not collected face-to-face, having been carried out exclusively through electronic means and contacts by telephone.