Underground Construction - July 2021 - 23

Daniel Shumate | Managing Director, FMI Capital Advisors Inc.
3rd Quarter Utility & Communications
Construction Update
While the underground construction
industry performed admirably
throughout 2020 and into the second
quarter of 2021, there is an air of
uncertainty for what the second half of
2021 will bring. While the challenges to
the oil and gas market weigh on the full
potential, most underground companies
have full backlogs and are struggling to
find the right people.
We are also seeing legitimate material
pricing and supply issues that could
impact the back of the year. The United
States was not quite able to produce a
" V-shaped " recovery as was suggested
by economists about a year ago, but the
path back to a low unemployment rate
has been impressive. FIGURE 1 illustrates
just how dire the unemployment
situation was in April of 2020 and how
much progress the country has made
since. The remaining 2 to 3 percent
improvement is quite challenging to
solve and if obtained would represent an
economy at " full " unemployment.
In March of 2021, the federal
government, with the assistance of the
federal reserve, put the pause button on
the United States economy. Over the past
12 months, additional stimulus packages
have prevented some of the worst-case
scenarios but may now be limiting the
recovery. Multiple theories exist as to
why the recovery in the unemployment
market has slowed. Potential reasons
include limited childcare options,
increased unemployment benefits, fear
of returning to the office and select
states maintaining lockdown regulations.
The increased unemployment is likely
10
12
14
16
2
4
6
8
Jan. 2018
July 2018
Jan. 2019
July 2019
Jan. 2020
July 2020
FIGURE 1: Seasonally Adjusted Unemployment Rate, 2018 to Present.
Source: Bureau of Labor Statistics
24
44
64
4
-76
-56
-36
-16
June 2018
-24
-4
16
36
56
76
96
116
136
June
2020
July
2020
Aug.
2020
Sept.
2020
Oct.
2020
Nov.
2020
Dec.
2020
Feb.
2021
March
2021
April
2021
FIGURE 3: LTM UCC Index. Source: FMI Research, S&P Capital IQ; as of June 10, 2021
UCONonline.com | JULY 2021
23
Jan. 2019
June 2019
Jan. 2020
June 2020
Jan. 2021
FIGURE 2: 3 Year UCC Index. Source: FMI Research, S&P Capital IQ; as of June 10, 2021
May 2021
S&P 500
UCC Index
Jan. 2021
May 2021
S&P 500
UCC Index
May
2021
June
2021
%
%
Unemployment rate, %

http://www.UCONonline.com

Underground Construction - July 2021

Table of Contents for the Digital Edition of Underground Construction - July 2021

Contents
Underground Construction - July 2021 - Cover1
Underground Construction - July 2021 - Cover2
Underground Construction - July 2021 - Contents
Underground Construction - July 2021 - 4
Underground Construction - July 2021 - 5
Underground Construction - July 2021 - 6
Underground Construction - July 2021 - 7
Underground Construction - July 2021 - 8
Underground Construction - July 2021 - 9
Underground Construction - July 2021 - 10
Underground Construction - July 2021 - 11
Underground Construction - July 2021 - 12
Underground Construction - July 2021 - 13
Underground Construction - July 2021 - 14
Underground Construction - July 2021 - 15
Underground Construction - July 2021 - 16
Underground Construction - July 2021 - 17
Underground Construction - July 2021 - 18
Underground Construction - July 2021 - 19
Underground Construction - July 2021 - 20
Underground Construction - July 2021 - 21
Underground Construction - July 2021 - 22
Underground Construction - July 2021 - 23
Underground Construction - July 2021 - 24
Underground Construction - July 2021 - 25
Underground Construction - July 2021 - 26
Underground Construction - July 2021 - 27
Underground Construction - July 2021 - 28
Underground Construction - July 2021 - 29
Underground Construction - July 2021 - 30
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Underground Construction - July 2021 - 33
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Underground Construction - July 2021 - 50
Underground Construction - July 2021 - Cover3
Underground Construction - July 2021 - Cover4
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