CFMA’s 2022 Construction Financial Benchmarker Executive Summary

General Information

CFMA and Industry Insights are pleased to present the Executive Summary from CFMA’s 2022 Construction Financial Benchmarker Online Questionnaire. The survey results fuel the industry’s only Financial Benchmarker tool (, whereby construction companies can compare their financial performance to others in the industry.

The 2022 Benchmarker Questionnaire was distributed to approximately 9,000 potential respondents including both CFMA members and non-members, as well as Construction Industry CPAs/Consultants Association (CICPAC) member firms that represent both member and non-member construction companies (most of which are based in or have significant employment in the U.S. and Canada).1

A total of 1,294 companies submitted data by July 2022. Of those respondents, 1,209 provided detailed and valid financial statements and other required information needed for inclusion in the financial portion of the results.

CFMA’s Benchmarker Questionnaire is confidential and unique to the industry. All results, accessible through the Benchmarker tool, are presented in composite form and segmented by type of construction work performed, region, revenues, and financial performance.

Overall Results

Company Profile

Of those that provided NAICS information, 44% of respondents were Specialty Trade, 30% were Industrial & Nonresidential, and 22% were Heavy Highway. This distribution of respondents by type was largely consistent with previous studies.

The Midwest and Far West were the most widely represented (24% and 21%, respectively) of those that provided regional information. The remaining companies were relatively equally distributed among the other U.S. regions. Canadian and foreign companies accounted for less than 1% of the sample.

General/prime contractors, or contractors that self-perform more than 20% of construction work, was the primary role associated with 43% of total respondents. Subcontractors, or those that perform 50% or more of construction work for another contractor, represented 41% of responding companies. Companies that self-perform less than 20% of construction work accounted for 15% of the sample.  

Most respondents (82%) did not qualify to bid public projects under a Disadvantaged Business Enterprise (DBE) category in 2021. Of those qualified, the Small Business Enterprise was the most cited (71%) category followed by Woman-Owned Business Enterprise (29%) and Minority Business Enterprise (22%).

Of responding companies, 76% indicated they operate as an S corporation and are privately owned within the U.S. (89%). These legal classifications and ownership structures of reporting companies are in line with the historical results of the study.

Financial Information

In 2021, as the 2020 results and the impact of the pandemic were being evaluated, there continued to be a large list of uncertainties facing the industry as well as the nation. In response to the economic impacts of the pandemic, the U.S. government provided unprecedented relief funding in the form of Payroll Protection Program (PPP) loans and Employee Retention Credits (ERCs). These programs allowed companies the flexibility to maintain staff or limit reductions in staffing levels. The results of this study are inclusive of ERCs and PPP loans, which are reported as other income if forgiven or recognized using the grant approach accounting method.

For many of the reasons described previously, the impact of COVID-19 must be considered when evaluating the results of this year’s study and beyond. It is also important to consider the impact of inflationary pressures as labor and supply chain issues continued to mount during 2021, which contributed to inflation reaching the highest levels since the 1980s. Although the Fed has implemented rate hikes in efforts to tame inflation, it is anticipated that supply chain issues, a tight labor market, and inflationary pressures will continue to be present for the foreseeable future.

Despite the challenges companies faced, most respondents experienced positive sales growth during 2021. Monitoring sales change is critical as it often drives a company’s performance and ability to achieve profits. Overall, companies experienced a 5% increase in total revenue volume in 2021 over 2020. Note: sales growth figures are calculated solely based on total revenue dollars and are not impacted by PPP loan adjustments.

Profitability measures were strong for most companies during 2021. The Return on Assets (ROA), which provides an indication of how well assets are utilized to generate profits, grew from 13% in 2020 to 15% in 2021. Perhaps the best measure of a company’s overall performance is its Return on Equity (ROE). Overall, companies reported a 36.1% ROE, which is up 6.5 percentage points from pre-pandemic (2019) levels. Despite a 0.6 percentage point decline in gross profitability in 2021 from 2020, pre-tax net income grew from 7% in 2020 to 8% in 2021. Loans through the PPP program and that were forgiven or recognized using the grant approach accounting method and ERCs received contributed 4% of total revenue to the bottom-line profitability.

The fixed asset ratio offers an indication of the level of stockholders’ equity invested in net fixed assets. The fixed asset ratio for the median respondent fell considerably from 27% in 2020 to 22% in 2021, which generally indicates companies are now in a more favorable liquidity position.

From a financial position standpoint, the current ratio provides an indication of short-term liquidity. The typical company reported a current ratio of 1.8. As this is the coverage of current liabilities by current assets, organizations should investigate if this ratio were to fall below 1.0.

The debt-to-equity ratio is a good indicator of the relationship between creditors and company owners. A low debt to equity ratio typically implies a very stable organization. A debt-to-equity ratio of 1.0 would indicate that owners and outside creditors/lenders have an equal stake in the company’s assets. Overall, the median debt to equity ratio for respondents improved to 1.2 in 2021 from 1.4 reported in 2020.

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