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EVs Hit a Rough Patch

Jan. 29, 2024


Jim Lucy2015 1025 63bc6c4f6a9d1

A Season of Discontent

Jan. 9, 2023
Forecasting can be a frustrating business because of stale data and fast-changing economic conditions.

As EW’s editors were selecting market areas for this month’s cover story on the metros with the most growth in electrical sales potential next year, it became immediately apparent that forecasting growth in the current economic climate would be trickier than usual.

The war in Ukraine, state of international financial markets, inflation, supply chain shortages, rising interest rates and COVID’s continuing grip on China continue to cloud any forecaster’s crystal ball, and have unexpectedly disrupted the global economy (see “A Flock of Black Swans,” in June’s Times & Trends column).

A regular challenge during forecasting season for electrical executives is that so many of the available market indicators published by the U.S. government’s Census Dept. and Bureau of Labor Statistics are lagging indicators that measure business or employment activity several months back rather than forecast what may happen in the future. That’s an issue. We all saw how quickly COVID crippled the global economy and how economic conditions turned on a dime because of it. Relying too heavily on data that looks back several months is like driving a car by looking in the rear-view mirror to see where you have just been.

Fortunately, tools are available in the electrical market that can help you look into the future. Here are several that you can help you with your 2023 projections.

Electrical Marketing newsletter (

EM provides an extensive package of local market indicators and sales estimates for $99 per year.

DISC Corp.

Chris Sokoll has done a great job expanding DISC’s suite of forecasting data and tools since purchasing the business in 2019.

AIA’s 2023 Consensus Construction Forecast and Architecture Billings Index (ABI) (

Because members of the American Institute of Architects (AIA) are involved so early in the design phase of the construction process, they see what’s happening in the market at least six months before distributors and their customers. The ABI is a monthly survey of AIA members on their billings and inquiry activity. At press-time, the ABI was still looking good, but Kermit Baker, AIA’s chief economist, says it’s pointing to some softening in the second half of 2023.

AIA’s 2023 Consensus Construction Forecast is also surprisingly bullish, and expects nonresidential construction activity to increase +6% in 2023 and industrial construction to increase +9.9%.

A big caveat with this forecast is that it blends the forecasts of eight of the nation’s leading construction economists, and their forecasts tend to vary quite a bit. For example, Dodge Construction Network and ConstructConnect expects nonresidential construction activity to increase at a double-digit rate next year, while three forecasters — Associated Builders & Contractors, Wells Fargo Securities and Markstein Advisors — all see increases of less than +3%.

Dodge Momentum Index (

Published monthly by Dodge Construction Network, the Momentum Index is a monthly measure of the initial report for nonresidential building projects in planning that tends to lead construction spending for nonresidential buildings by a full year. The most recent report in August says commercial construction increased +1%.

NAHB/Wells Fargo Housing Market Index (

This monthly survey of builder sentiment fell for the ninth straight month in September to its lowest level since Sept. 2014.

Your customers

Check in with your contractor and industrial accounts to get their take on project backlogs, planned expansion or maintenance and other electrical spending. Your customers offer the best real-world take on local market conditions.

Ed Koch, the mayor of New York from 1978 to 1989, would often stand outside subway stations and ask residents, “How am I doing?” Good, bad or indifferent, he wanted to know, and famously once said, “If you agree with me on nine out of 12 issues, vote for me. If you agree with me on 12 out of 12 issues, see a psychiatrist.”

We can all learn from the late Mayor Koch about the importance of listening to our customers. 

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