Reading the data

In the regional update section, we analyze the construction market across several locations in the US. In doing so, we explore multiple economic indicators, as well as the supply chain capacity within a typical building project.

Key performance indicators

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Metric

Descriptions

Source

Construction escalation

This measures the trend of contractors’ pricing level in accepted bids, i.e., cost to the client.

Turner & Townsend

CPI-U

The Consumer Price Index for All Urban Consumers (CPI-U) is a monthly measure of the average change over time in the prices paid by consumers for a market basket of consumer goods and services.

Bureau of Labor Statistics

Residential building permits

National, state, and local statistics on new privately-owned residential construction.

Census Bureau

Unemployment rate

The unemployment rate represents the number of unemployed people as a percentage of the labor force (the labor force is the sum of the employed and unemployed).

Bureau of Labor Statistics

Supply chain capacity

Descriptions

Above escalation

In normal market conditions, a supply chain which has capacity would be more competitive in their pricing strategies to secure work. As such, price increases are offset by the desire of the supply chain to secure work which leads to price increases below escalation.

Below escalation

In normal market conditions, a supply chain which has limited capacity would be less competitive in their pricing strategies when bidding for new work. As such, price increases are exaggerated since there is little supply of labor to execute the work. This leads to price increases above escalation.