Underground Construction - July 2022 - 14

UTILITY&COMMUNICATIONS
Construction Update
Daniel Shumate | Managing Director, FMI Capital Advisors Inc.
" Less for More " remains the theme for
FIGURE 1: Consumer Price Index
2022, as price increases in labor, materials
and fuel plague the underground
construction industry. Th e " transitory "
discussions of 2021 are a distant memory
and pricing pressure is aff ecting almost
every line-item of the bid sheet. Th is has
begun to impact both the public and private
markets. Th e stock market has declined
signifi cantly, as has fi rst-quarter
deal activity, across all markets.
Additionally, due to rising demand
and, most recently, the war in Ukraine,
oil
prices have increased
at
almost
FIGURE 2: United States Producer Price Change (10-Year Lookback). Source: U.S. Bureau of
Labor Statistics
break-neck speed over the last two
years - more than 500 percent since the
lows of 2020. Due to the federal government's
environmental policies, however,
U.S. energy companies are hesitant
to make the investments in drilling and
large pipeline infrastructure that would
accommodate price decreases.
As a result, gasoline prices have increased
to an average of $5 per gallon
for the fi rst time in U.S. history.
Finally, labor prices have risen yearover-year,
att empting to keep pace with
mounting infl ation and because the
market has been near full employment
for some time (see FIGURE 1 for CPI).
However, the Federal Reserve's actions
will weigh heavily on the economy, and
increased
availability
FIGURE 3: Monthly Supply of New Houses in the United States
14 JULY 2022 | UCONonline.com
and
decreased
labor costs should occur as the federal
rate grows.
In addition to the oſt en-cited CPI
(Consumer Price Index), Producer
http://www.UCONonline.com

Underground Construction - July 2022

Table of Contents for the Digital Edition of Underground Construction - July 2022

Contents
Underground Construction - July 2022 - Cover1
Underground Construction - July 2022 - Cover2
Underground Construction - July 2022 - Contents
Underground Construction - July 2022 - 4
Underground Construction - July 2022 - 5
Underground Construction - July 2022 - 6
Underground Construction - July 2022 - 7
Underground Construction - July 2022 - 8
Underground Construction - July 2022 - 9
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Underground Construction - July 2022 - 11
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Underground Construction - July 2022 - 14
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Underground Construction - July 2022 - 20
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Underground Construction - July 2022 - 25
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Underground Construction - July 2022 - 27
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Underground Construction - July 2022 - 42
Underground Construction - July 2022 - Cover3
Underground Construction - July 2022 - Cover4
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