Estimating for the Construction Boom

Many contractors cut back significantly when business slowed down, which may have had a profound effect on their labor costs, production rates and overhead structure and may have caused a change in the markups used in estimating. 

What happens when things start to boom?  You may experience a sudden increase in business, and start to scramble to find workers and managers.  You may have to add overhead to support the increased volume. There have been significant labor shortages recently – will you have to pay more in wages and benefits than in the past to find qualified workers?  Contractors must carefully consider their labor and overhead structure and consider revising their production rates and overhead markup when pricing work that will be done during the boom times.  Keep an eye on your materials costs and know that a boom can cause shortages and upward price pressure.  This will help keep you profitable and competitive going forward.