Home » Behind the Headlines (Page 2)
Category Archives: Behind the Headlines
Construction Analytics provides in-depth and unique analysis and future forecasting of construction data valuable to a wide variety of users. Construction Analytics data has been referenced by construction firms, university graduate studies, real estate firms, online educators, investment firms, school district planning boards, public agencies for developing infrastructure budgets and news agencies around the country.
Construction firms, real estate developers, national construction organizations and industry conference planners have engaged Construction Analytics to provide special reports and presentations.
National agencies, universities, construction firms and conference planners have reached out to Construction Analytics for presentations to large and small groups. A sampling of some construction economic presentations: American Institute of Architects; Associated General Contractors; Project Management Institute; McGraw Hill Construction; Georgia Tech Civil Engineering; Worcester Polytechnic Institute Civil Engineering; Hanson-Wade Advancing Building Estimation Conference.
Construction Analytics has appeared in interviews by Bloomberg TV and ConstructechTV and has been widely quoted in Bloomberg News, Washington Post Business, WaPo Fact Checker, Financial Times, CNBC, Marketwatch Economy, Newsweek, Los Angeles Times, Ontario Construction News, strategy+business, Yahoo!Finance, STEEL Market Update, BuildingConnected, Constructiondive, BuildZoom and a host of other blogs and news sources.
Construction Spending for Jan was just released March 13th at $1.287 trillion saar, up 1.3% from Dec. But…
the most notable numbers in this March report are BIG REVISIONS DOWNWARD TO NOV (-2.3%) AND DEC (-2.2%), particularly to residential.
Residential revisions Nov -3.9%, Dec -4.4%.
Nonresidential revised down -0.8% in both Nov & Dec.
2018 total spending currently at $1.293 trillion, 2% below expected.
If these residential reports are correct, we have been in a residential construction spending downturn, now down 12% since last May. I predict these numbers are suspect.
Current total residential spending for 2018 in this most recent report is $545 billion, up 2.6% from 2017. But after deducting 4.4% residential inflation, that means real residential construction volume would be DOWN -1.8% for 2018. Yet, new starts in 2018 were up 6% and new residential jobs increased 3.5%.
However, in 2018 residential spending, the monthly variances from statistical rates of spending look very similar to 2006, up thru May then down 15% to year end.
Cash flow models of construction starts data from Dodge Data for residential spending spread over time indicate residential spending should be UP 3% since May, not down!
Just a reminder, we had a huge upward revision to 2015 residential spending data in July 2016. The 2018 data gets a big revision on July 1, 2019.
The monthly spending data gets revised three times after the 1st release. In the mean time, it can be compared to the statistical averages to determine if 1st reports, or even 2nd reports of spending are in line with expectations. The current Nov and Dec residential construction spending data varies from the statistical average by 3 to 4 standard deviations. That’s highly unusual!
To understand just how unusual that is, let’s compare to how rare any monthly spending varies by 2 standard deviations (StdDev) from the statistical monthly average:
Non-Builiding Infrastructure has varied by 2 StdDev only 5 times in 18 years, only once in the last 15 years, even including recessionary years.
Excluding recessionary years, Nonresidential Buildings varied by more than 2 StdDev only 12 times in 16 years and only 4 times in the last 8 years.
In both those data sets above, only twice ever in over 400 total months of data was the variance greater than 2.5 StdDev.
Excluding recessionary years, Residential Building monthly spending exceeded 2 StdDev from the average only 10 times in 14 years, all 10 times were in the last 8 years.
Recessionary years really skew the data. Non-building Infrastructure was the only sector not affected by the recession like all other construction. Residential spending was affected the most. In the four residential recessionary years, 2006-2009, residential monthly spending (in 48 months) exceeded 2 StdDev 28 times, 19 of those times 3 StdDev or greater.
In the residential data set, 5 of the 10 non-recessionary variances over 2 StdDev were in 2018. That simply does not occur in the historical data. That’s like having your teenage son grow an inch every year from 13 to 16 but then shrinking 2 inches in year 17. The average of those 5 unusual months in 2018 was 3.5 StdDev from the statistical average, with Nov and Dec posting the greatest variances since 2009.
The only time we’ve ever seen data like that was within the recession years of 2006-2009. So, either the 2018 residential data is foretelling the beginning of another recession, or the data, particularly the Nov and Dec data, will be subject to significant revisions, in this case upward.
Starts and cash flow expectations seem to indicate the 2018 data is currently being reported too low. I expect 2018 residential data will be revised up by $10bil to $15bil. We may not have that information until July 1, 2019.
Feb 26, 2019
Since the bottom of the construction recession year 2011, through 2018 construction spending has increased 67%. During that time construction volume has increased only 32%. All the rest was inflation.
Construction spending is not the only factor for business growth planning. The adjustment for Inflation is the most important factor.
If your company revenues are increasing at a rate of 7% per year at a time when construction inflation is 5%, your business volume is increasing only 2% per year. If you do not factor inflation into your growth projections, you are not forecasting growth properly. Spending is revenue. Volume is spending minus inflation.
Look at the data to the left of the vertical line through 2006. Notice in the bottom plot in the years 2004 and 2005 there is very high spending but very low volume. In 2006 spending was up 4% but real volume declined 3%. For those three years inflation totaled nearly 30%. On the top plot you can see the cumulative effect of several years of high inflation. From 2000 to 2006 spending increased 45% but volume barely moved at all. During this period jobs increased by about 15% and even that outpaced volume. Businesses watched as spending increased 45% in seven years. They increased staff by 15%, but real volume was flat. Heading into the recession construction dollars on the books had been increasing for years but volume was stagnant and companies were top-heavy with jobs.
Addressing the current period 2011 through 2018, if you base business growth on your annual revenue growth, or spending, rather than using inflation adjusted dollars, your forecast for business growth over this eight year time period would be more than double actual volume growth.
Notice the blue bars for annual spending growth in 2017 and 2018 at approximately 4% and 5% respectively. But look at the black lines superimposed on those bars that reflect real volume growth after inflation. There has been only 1% real volume growth in the last two years. Yet jobs increased 8% in two years. Most of the growth in spending is inflation dollars, not real volume growth. Inflation does not support jobs growth.
For 2017-2018 residential spending increased 17% but volume was up only 7%. Nonresidential buildings spending up 6.5% but volume was down 2.5%. Non-building infrastructure spending was up 4% but volume was down by 3%. Inflation across these sectors totaled 7% to 10% for these two years.
Construction jobs, now over 7,400,000 have been over 7,300,000 since summer 2018. The last time jobs were over 7,300,000 was mid-2005 through early 2008, at which point the recession abruptly caused the loss of over 700,000 jobs within 10 months and more than 2 million jobs over the next three years. Jobs are now only 5% lower than the previous high of 7,700,000 in 2006-2007. But construction volume is still 15% below peak constant $ volume reached in early 2006. So the current situation of jobs growth rate exceeding volume growth is worse than it was leading into the last recession.
For 2019 I expect residential and nonresidential buildings to experience a slight decline in volume. I do not yet see a recession as volume picks up again in 2020, but nonresidential construction jobs in particularly have been increasing faster than volume for several years. Part of that is explained by some nonresidential workers are used to build residential space (hi-rise structure). When the next downturn hits, the potential need to cut nonresidential construction jobs may be quite painful.
Best Construction Blog voting begins 2-1-19 and continues through 3-31-19.
This blog, Construction Analytics – edzarenski . com, has been nominated for the 2019 Best Construction Blog competition.
In January, more than 8,000 visitors generated 17,000 views. The 2019 Economic Forecast Summary had more than 3,000 views and the Inflation Index Tables more than 4,000 views. This blog now gets more visitors and more views per month than I got per year when when I worked for and my reports were published and distributed by a major national construction firm. I believe that is because of the varied content being made available to the public.
There are a lot of readers out there accessing materials on this blog. That’s a lot of potential voters. I’m asking for your vote.
If you visit my blog because you find value in the construction economic news provided here, then please take a minute to visit the link below and vote for Construction Analytics. Thank you. Ed Zarenski
Some important points in the Construction Starts data that show how important it is to keep track of long-term trends. The month to month reports can often make the data look much different than the trend. Most recent data here is the November report issued Dec 20 by Dodge Data.
Here’s the spending forecast that shows how starts are impacting construction spending 2019 construction economic forecast nonresidential Dec 2018
Manufacturing construction starts in Nov plunged 71%.
Manufacturing starts in Oct were up 180% and June was up 1300%, 2 of top 5 best months ever. Starts are on track to finish the year up 20%+, 2nd best year ever.
Transportation terminals construction starts in Nov plunged 73%.
Transportation terminals had a blockbuster year in 2017, up 125% with 3 of the best ever monthly starts. Oct 2018 was 4th best starts ever. 2018 will finish as 2nd best year ever.
Amusement/Recreation starts in Nov dropped 18%.
Amusement/Rec starts in October was the 3rd best month ever recorded. Nov is still near one of the best ever. Amuse/Rec starts in 2018 will total the best year ever recorded up 25% from 2017, up 100% in 5 years.
Educational construction starts in Nov dropped 6%.
Educ starts have declined 3 months in a row, but that is from the highest 4 months ever recorded. 2018 construction starts are on track to finish up 13%, the best year ever, averaging gains of 11% a year for last 5 years. Starts from the last five months of 2017 posted the highest 5mo total in at least seven years, 13% higher than the next best 5mo
Healthcare construction starts are down 8% in Nov.
Healthcare starts could finish 2018 down 3%, but on average are up 4%+/year for the last 5 years. Starts are near the all-time high reached last year.
Office construction starts in Nov down just 2%.
Office construction starts declined 4 of last 5 months, but June, Oct and Nov were the 3 best months in 10 years. Office starts are on track to finish 2018 up 15%, best year ever, up over 100% in last 5 years.
Commercial/Retail starts have been increasing every year since 2010 but starts in 2018 are flat vs 2017 Starts are at a peak but after 5 years of 15%-20% growth/year are up only 4% in the last two years.
Commercial starts are seeing strong gains from distribution centers (warehouses which are in commercial spending). The decline in retail stores is being hidden by the increase in warehouses, which are at an all-time high. Stores are down 10% from the peak in 2016. Warehouses are still up only 4% in 2018 but increased 500% from 2010 to 2017.
Highway and Bridge construction starts fell 33% in Nov.
Highway starts in October were the highest since January 2014. Highway starts have increased on average 3%+/year the last 7 years. Starts in 2018 reach an all-time high.
Environmental Public Works includes Sewerage projects, Water Supply and Conservation, or dams, water resource and river/harbor projects. New starts for all these types projects declined from 2014 through 2017. In 2018, through November, Water Supply posted 5 down months, Sewerage post 6 down months and Conservation posted 7 down months. Yet all are forecast to finish 2018 with gains.
More on Construction Starts
Catch my interview on Constructech TV with Peggy Smedley, along with Bernie Markstein. We are talking about the Economics of Construction.
Bernie covers Trade and Tariffs and the cost affect of steel, lumber and aluminum tariffs on residential and nonresidential construction.
I talk about growth in construction spending, infrastructure markets that are leading the way, the capacity to absorb more work and the impact on labor and the rate of growth of labor versus real construction volume.
New Construction Starts is powerful data if used properly. Understand how to use the data and you have an excellent forecasting tool.
New Construction Starts is incorrectly used when the data is referred to as construction spending. It cannot be used to look at the year over year (yr/yr) or month over month (mo/mo) trend in values to predict % change in construction spending. This misrepresents how to use New Starts data.
Care must be taken to use Starts properly. It is sometimes misinterpreted in common industry forecasting articles. Starts dollar values represent a survey of about 50% to 60% of industry activity, therefore Starts dollar values cannot ever be used directly to indicate spending. Also, Starts do not directly indicate changes in spending per month or per year. Projected starts data cannot be used to directly forecast expected construction volume.
Only by including an expected duration for all Starts and producing a forecast Cash Flow from Starts data can the expected pattern of spending be developed. Finally, it is the rate of change in Starts Cash Flows that gives an indication of the rate of change in spending.
Cash flow is the best indicator of how much and when spending will occur. Cash flow from starts gives a prediction over time of how spending from each month of previous starts will change from all projects in backlog. Cash flow totals of all jobs can vary considerably from month to month, are not only driven by new jobs starting but also old jobs ending, and are heavily dependent on the type, size and duration of jobs.
New Starts for the month or the year is the total value of new project revenues that came under contract in that period. Since the values reported for Starts are a sampling survey of about 60% of the industry totals, the total dollar volume is not comparable to actual spending. However, the percent change in values is very useful.
The entire value of a project enters backlog when the contract is signed and work begins. That’s a new start. Projects booked on or before December 31st, that still have work remaining to be completed, are in backlog at the start of a new year.
Simply referencing total new starts or backlog in the year does not give an indication of spending within the year or next calendar year. Projects, from start to completion, can have significantly different duration. Whereas a residential project may have a duration of 6 to 12 months, an office building could have a duration of 18 to 24 months and a billion-dollar infrastructure project could have a duration of 3 to 4 years. New starts within any given year could contribute spending spread out over several years. Total Cash Flow in the Year, or Spending, could include spending from projects that started years ago.
Backlog at the start of the year could include revenues from projects that started in December or several years ago. For a project that has a duration of several years, the amount in starting backlog at the beginning of the year is the amount remaining to complete the project or the estimate to complete (ETC). And all that ETC may not be spent in the year following when it started, dependent on the duration remaining to completion.
The only way to know how much of total starts or total backlog that will get spent in the current year and following years is to prepare an estimated cash flow from start to finish for all the projects. The sum of the amounts from all projects ongoing in each month gives total cash flow in that month, or monthly spending in that year. Spending in any given month could have input from projects that started many months ago. The sum of the cash flow is what shows the expected change in spending.
The following table clearly shows there is not a correlation between starts in any year with spending in the following year. The practice of using construction starts directly to predict spending in the following year can be very misleading in an industry that relies on data for predictive analysis to plan the future. Not only does it not predict the volume of spending in the following year, it does not even consistently predict the direction spending will take, up or down, in the following year. It’s a false indicator and it’s not a good use of data.
Construction spending is strongly influenced by the pattern of continuing or ending cash flows from the previous two to three years of construction starts.
Current month/month, year/year or year-to-date trends in starts often do not indicate the immediate trend in spending.
Power market starts and spending provides a good example.
Power starts peaked in 2015 at an all-time high, up 140% from 2014 and more than the prior two years combined. Yet Power spending was down 6.5% in 2015 and down 1.5% in 2016. This happened because Power starts were also at an all-time high in 2012, just below the 2015 level, and those starts drove 2014 spending to an all-time high, but then tapered off in 2015. Those peak starts from 2015 will still be contributing spending for several years to come, long beyond typical jobs, and that drives typical spending growth because it adds more than typical number of months that contribute spending.
Power starts gained only 1.5% in 2016, dropped 7% in 2017 and are expected to finish 2018 down 12%. The pattern of cash flows from starts is indicating growth in spending for 2018 and 2019. Starts from 2015 and 2016 with longer than average duration contribute spending out to 2020 & 2021, breaking the average balanced cycle of one month of old jobs ending for every new month of jobs starting. That drives the pattern in spending.
The following example shows what happens to monthly spending growth when a long duration job first influences spending past the typical duration and then when it ends. In the example table presented below, starts grow at 1% per month and have a typical duration of 5 months. But one unique month has an unusually large project start that will last for 10 months.
A typical month of spending has cash flow from 5 months of starts, but the long duration project creates 6 months of cash flows for the period beyond typical duration. Notice what happens and when it occurs.
When the large project starts it has no unusual effect on spending. But when it first extends beyond typical duration, it has a massive +20% growth effect on spending, even though starts had only been increasing at 1%/month for the previous 5 months. When it ends it has a similar downward effect, again, even though starts had been increasing at 1%/month.
Spending growth (or declines), both when an extra-large job causes it to increase and then when the extra-large job ends, is almost entirely influenced by the long duration project, not by normal monthly starts growth rate. This same example can be over months or over years.
Spending patterns are far more influenced by projects with unusual duration. Construction spending is strongly influenced by the pattern of continuing or ending cash flows from the previous two to three years of construction starts. Cash flow is the best indicator of how much and when spending will occur.
All construction starts data in this report references Dodge Data & Analytics Starts data.
New Construction Starts for July in the latest report from Dodge Dodge July 2018 Construction Starts are down 9% from June, but June starts reached an all-time high Seasonally Adjusted Annual Rate (SAAR) of $899 billion. July posted at $817 billion. May was $804 billion. The May-Jun-Jul three month average SAAR construction starts is $840 billion, all-time high.
The Dodge July construction starts report posted $78 billion of new starts and highlights 19 projects valued over $200 million, one of those at $2.4 billion and 17 projects valued between $100-$200 million. The Dodge June construction starts report posted $98 billion of new starts and highlighted 7 projects over $1 billion (totaling $16.5 billion), 17 more projects over $200 billion and 15 projects between $100-$200 billion. The starts report is a sampling of about 2/3rds of all projects.
New construction starts in the 1st half 2018 reached an all-time high.
The new high in construction starts is measured in current $. When adjusted for inflation (constant $), total starts are still about 20% below 2003-2004, when all sectors reached their previous highs. A closer look at constant $ starts adjusted for inflation shows nonresidential buildings about 8-10% below the previous high, non-building infrastructure about 6-8% above the previous high, but residential is still 40% below the previous high.
Residential starts average for the 6 months Jan-Jun 2018 is the highest since 2006. The 1st 6 months of 2018 is up 8% from the prior 6 months.
Dodge Outlook Midyear Update is forecasting 2018 single family starts to gain 6% and multifamily to gain 3%. Year-to-date through July, single family starts are up 7% and multifamily up 6%.
Non-building infrastructure starts for July are level with June and level with the average of the 1st six months. Starts may finish the year slightly down from 2017. However, 2017 was the best year of starts on record. The growth in Infrastructure starts will drive Non-building spending to record highs in 2018 through 2020.
Transportation, in Census spending reports, includes all airport work, air-side and terminals. It also includes rail work, track and terminals and dock work. In Dodge Data starts data, terminals are included in Other Institutional and rail work is included in Other Public Works. Terminals and rail work are included in this analysis in Transportation Infrastructure so that starts can be compared with Census spending data..
Terminal starts are down YTD, 50% lower than 2017. But 2017, which included the start of six major airport terminals, was so high, up 120% over 2016, that even though 2018 is down it will be the 2nd strongest year of starts on record. Rail work also doubled in 2017 and will remain close to even for 2018. Starting backlog for transportation projects doubled from the start of 2017 to the start of 2018. Backlog is on track to increase another 25% to start 2019. No other market will realize the gains in construction spending that we will see from transportation for 2018 and 2019.
Power generation plant starts cause erratic bumps in Power work. In the last year there have been a dozen or more project starts valued over $500 million each, six of those over $1 billion. Also included in Power, Pipeline starts represent half of all Power work started YTD. Cash flow may be adversely impacted by the delay of large projects that started previously. A multi-billion dollar nuclear power plant stopped work and large pipeline project delays have reduced the previous forecast for cash flow.
Highway starts hit an all-time high in 2017 and are forecast to surpass that by a few percent in 2018. Highway starting backlog increased 30% in the last 3 years and will increase 6% leading into 2019.
Nonresidential buildings starts in July reached $318 billion, down 22% from June, but June reached $402 billion, nudging up against the all-time high from 2008.
Manufacturing starts are down 60% from June, but June was the highest month ever recorded, three to four times the average monthly starts. July is the 4th best month in the last 3 years, going back to April 2015, the 2nd highest month ever. The decline of manufacturing starts from the June high to a normal amount in July accounts for more than half of the total Nonres Bldgs decline in July. The news is not the decline in July, a return to normal, but the abnormally high starts in June.
Office and Warehouse starts, both up from a strong 2017, are seeing gains from data centers (in office) and distribution centers (in warehouse which is in commercial spending). Amusement/Recreation starts YTD are triple last year. The only nonresidential markets lower year-to-date are retail stores and healthcare. The decline in retail stores, which is also in commercial spending, is being hidden by the increase in warehouses, which are at an all-time high.
Adjusted for inflation, Jan 2008, by a few percent, is still the best ever for nonresidential buildings starts and spending.
The plots above show the 3mo moving average and trend line of starts for Residential, Non-building Infrastructure and Nonresidential Buildings. Starts can be erratic from month to month. The trend line gives a better impression of how starts impact spending.
The plot below is an index. The plot shows greater accuracy in the forecast when the predicted cash flow and actual spending plot lines move in the same direction. If the slope of the lines is the same, then the cash flow accurately predicted the spending.
The light green line, spending estimated from starts cash flow, shows smooth spending, even though actual monthly starts are erratic (see nonres bldgs plot shown above). The actual spending often follows pretty close to the pattern as that estimated from cash flows.
Year-to-date (YTD) 2018 starts are up 2% from 2017, but 2017 starts through July have already been revised up by 12%, up 16% in nonresidential buildings, 22% in non-building and 4% in residential. 2018 starts will be revised next year and revisions have always been up. Revisions in previous years have averaged more than +7%/yr. for the last 5 years, with most of the upward revision in nonresidential.
Dodge reported this headline on Nov. 2, 2017 “New Construction Starts in 2018 to Increase 3% to $765 Billion According to Dodge Data & Analytics.” At the time, Dodge predicted construction starts for 2017 on track to finish at $745 billion. However, as each new month of starts is reported in 2018, the comparable month in 2017 is revised up to the latest data. Currently through July 2018, total starts in 2017 have already been revised up to $795 billion. 2017 starts, once all revisions are posted, could reach close to $800 billion.
2018 starts, based on initial data this year, could reach $800 billion, at first appearing to show no gain from 2017. Historically, revisions increase the initial total. After revisions posted next year, 2018 starts could reach $830-$840 billion.
Starts in both 2017 and 2018 are stronger than expected just 6 months ago. The current SAAR monthly $ of starts is 10% higher than anticipated just 6 months ago.
Construction spending is up year-to-date through May in every sector. Only Manufacturing and Power markets are down YTD, but not enough to drag the sectors negative. Both markets are expected to finish the year up. (Religious market is down, but represents only 0.2% of spending).
Cash flow from all starts still in backlog supports a 2018 spending forecast of $1,336 billion, a spending increase of 7% over 2017. The forecast for 2019, based on a 3% increase in starts, is $1,398 billion, an increase of 4.6% over 2018. The strongest growth in spending for 2018 and 2019 is forecast in Non-building Infrastructure.
Dodge reported May new construction starts at a seasonally adjusted annual rate of $778,000 million, up 15% from April. Also, year-to-date starts total $294,000 million, 3% lower than the same 5 months of 2017.
However, 2018 numbers will not be revised until next year and 2017 numbers through May have already been revised up 13%, up about 18% in nonresidential and 6% in residential. So the potential that YTD numbers remain 3% below 2017 is very small. Revisions to previous year’s numbers have averaged more than +7% for the last 5 years with most of the upward revision in nonresidential.
Revisions to 2017 year-to-date have already resulted in a 4% increase in both 2018 and 2019 starting backlog.
Although Dodge, in its midyear report, is predicting 2017 starts at a total of $763,000 million, the current rate of revision seems to indicate 2017 starts could reach closer to $800,000 million. Forecast 2018 total starts will increase only slightly over 2017.
Keep in mind, unlike the Census spending data which captures 100% of all spending, the new starts data is a sampling of project starts, representing about 60% of total work volume. For this reason, the actual starts dollars cannot be used directly to represent spending. However, the change in predicted cash flow from starts can be used to predict the change in spending.
From Sept’17 through May’18 new construction starts reached the highest average since 2004 and are just below an all-time high. Residential starts posted the best 6 months average since 2006, up 8% from the prior 6 months. Both nonresidential buildings and non-building infrastructure are lower than recent highs. Both could finish the year with starts at a decline of 4% to 5% below 2017 totals, but they are both still near the best year of starts on record.
Starts totals near new highs is in current $. If 2004$ were represented in constant 2018$, the total would be 40% higher due to inflation. So, after adjusting for inflation, today we are still 40% below that 2004 high point.
- TOTAL All Construction Starting Backlog for 2018 reached an all-time high, increased 35% in the last three years, 14% in the last year.
- Nonresidential Buildings 2018 starting backlog is the highest ever, up 50% in four years, up 17% from 2017.
- Non-building Infrastructure 2018 starting backlog is the highest ever, up 45% in three years, up 16% from 2017.
- Residential work within the year comes mostly from new starts within the year, only 30% from starting backlog.
The erratic nature of new construction starts belies how smoothly those projects feed into backlog and monthly spending.
Backlog shows fairly constant growth for the last 5 or 6 years. Spending in any given month includes projects started and entered into backlog from 1 month ago to 3 or 4 years ago. In some non-building cases, projects are in backlog for 6 to 8 years, so project starts that appear as a high spike enter backlog and spending and produce a constant upward slope. Most spending within the year in nonresidential work comes from backlog. Most spending in residential work comes from new starts.
The cash flow model of all previous jobs underway already in backlog and all new starts shows the current predicted spending. Starting backlog for 2018 plus new starts in 2018 minus all spending in 2018 generates the forecast work remaining in backlog for the start of 2019.
The predicted spending plot will be added here after July 1 Census spending release.
Much more to come in next few days. edz
This is a partial selection of slides I will be presenting on May 16 in Dallas at Hanson Wade’s Advanced Building Estimation Conference. I’m covering the topics Inflation/Escalation and Forecasting particularly as it relates to staffing planning.