One of the major hurdles that we attempt to forecast for our projects is escalation. There are many factors that affect escalation in the construction world which include inflation, supply chain and labor shortages. There are several ways to help predict construction escalation.
Turner Construction posts a quarterly cost index which measures costs in the construction market. Two other agencies that we look for guidance on our predictions are Consumer Price Index and local contractors. Also, using our own historical cost data from previous projects help us understand how the market has been behaving and allows us to make an educated guess to what escalation percentage will be needed to include for the future. There is no rule of thumb that can predict how the market is going to change. But with factual statistical information we can help validate and expect what is to come for our next project.
Interested in learning more about solutions for project construction escalation? Register for the 2022 MAPPA/MiAPPA conference below!