Start Strong: Key Metrics to Review This January to Set Your Construction Team Up for Success

The new year is here—and with it, a fresh opportunity to align your construction company’s financial and workforce goals. January isn’t just about closing the books on last year—it’s your launchpad for 2026.

If you wait until Q2 or mid-year to assess performance, you could already be behind. That’s why now is the time to check in on your financial metrics, workforce costs, and payroll processes—especially in an industry where project margins are tight, labor is scarce, and compliance can’t slip.

Whether you’re managing job costs, payroll, or certified reporting, here’s what your team should be reviewing in January to ensure you’re kicking off the year on solid ground.

1. Workforce Costs & Labor Burden

Payroll is often the biggest line item for construction firms—yet many finance and HR teams only review true labor costs once a project is completed. Start the year by assessing:

• Actual labor burden by role, trade, or union class

• Overtime trends and whether your OT rules are being followed

• Worker classification risks and certified payroll compliance

Understanding your true cost of labor helps you price more accurately, reduce overrun risk, and better forecast cash needs.

2. Cash Flow Visibility

Cash is still king—especially when it comes to funding payroll and materials in the field. Use January to:

• Analyze cash inflows/outflows from the last two quarters

• Forecast payroll liabilities vs. project funding timelines

• Review AR/AP balances to spot slow-paying clients or bottlenecks

If you're constantly shifting funds to cover payroll, it’s time to tighten your process.

3. Project Profitability by Labor

Job costing tells you what was spent—but a deeper dive into who did the work and for how long reveals why labor costs often balloon. Review:

• Time tracking by job and cost code

• Variance between estimated and actual labor hours

• Unbilled or misclassified labor tied to completed work

This insight helps you align your labor plan with actual field performance—and build smarter budgets.

4. AP Workflows & Overhead

Administrative inefficiencies are silent profit killers. Use the new year to identify:

• Where AP invoice delays are causing payment issues

• How much time is lost chasing paperwork or approvals

• What’s being spent on admin tasks that could be automated

Your goal? Free up internal time and reallocate it toward strategic work—like recruiting, forecasting, and compliance.

5. Tech Stack Integration Review

Disconnected systems lead to data silos, delays, and frustration. Ask:

• Is your payroll data syncing directly with your ERP?

• Are field entries (like time and expenses) flowing into the back office without rework?

• Can HR and Finance pull labor reports from the same source of truth?

If the answer is no, it’s likely costing you time, accuracy, and money.

6. Human Capital Strategy Alignment

With hiring challenges still top of mind, HR teams must be ready to support field operations from day one. Start the year by asking:

• Do we have the right people in place for upcoming projects?

• Are we set up to handle onboarding, certifications, and time tracking quickly?

• Are compliance and payroll deadlines fully aligned across HR and Finance?

Getting ahead of labor issues now means fewer surprises down the line.

Download the Construction Finance & HR Checklist for 2026

Want a quick way to keep your finance and HR teams aligned this January?

We’ve created a simple, actionable Construction Finance & HR Checklist for the New Year—built specifically for construction firms.

Use it to guide your year-start planning and ensure your financial, payroll, and workforce strategies are ready to support your 2026 goals.

hh2 Helps You Stay Ahead in 2026

Kicking off the year right starts with having full visibility into your financial and workforce performance. With hh2’s HR & Payroll, Time Tracking and AP Automation, you get real-time data synced to your ERP—giving you confidence in your numbers and clarity in your labor and cost strategies.

Whether you’re tracking union rules, managing certified payroll, or automating invoice approvals, hh2 helps you streamline operations and scale with ease.

✅ HR tools designed for construction
✅ Payroll-ready time tracking
✅ Construction AP automation
✅ Seamless ERP integration

Ready to get a 360° view of your projects and people in 2026?

Book a demo and let’s make this your most efficient year yet.