Economic indicators such as housing starts, employment rates, and new home sales are often recommended as a tool that contractors can use to predict future business. But there are no hard and fast rules that say how growth or stagnation in these areas will affect the remodeling industry. Without a practical application, the numbers are meaningless.

Michael Turner, vice president of The Home Service Store, in Kennesaw, Ga., says that it takes about three years before he sees any correlation between current numbers and the home improvement industry. “If Atlanta shows 15% growth in housing starts,” Turner says, “we'll see a corresponding growth in two or three years.”

The majority of Turner's business is in replacement projects, and he's only speaking about his market, so the three-year window might not apply exactly to your company. But it's worth the time, if you haven't done so already, to go back and look at old data to uncover the pattern in your market.