Costs and estimated earnings in excess of billings, commonly referred to as unbilled work, reflect work performed but not yet billed in many construction and contracting projects. The main cost drivers include direct labor, materials, and subcontractor services, along with overhead allocations and timing of billings. Understanding these figures helps manage cash flow and project profitability.
| Item | Low | Average | High | Notes |
|---|---|---|---|---|
| Unbilled Costs | $10,000 | $60,000 | $200,000 | Includes labor, materials, and subcontracts |
| Estimated Earnings In Excess Of Billings (EEB) | $5,000 | $45,000 | $150,000 | Project progress vs. billings |
| Current Billings | $15,000 | $70,000 | $220,000 | Invoices issued to date |
| Net Position (EEB − Billings) | −$10,000 | −$5,000 | $−$20,000 | Shows WIP exposure |
Assumptions: region, project type, contract terms, and timing of billings.
Overview Of Costs
Assuming a mid-size commercial project, unbilled costs typically range from $50,000 to $150,000, with EEB between $20,000 and $100,000 at mid-project stages. These figures vary by contract structure, measurement basis, and billing cadence.
Cost Breakdown
The following table illustrates how unbilled work and EEB are composed, with a mix of total and per-unit perspectives. Key drivers include labor intensity, material turnover, and milestone-based billings.
| Component | Low | Average | High | Assumptions |
|---|---|---|---|---|
| Labor | $8,000 | $40,000 | $120,000 | 10–15 workers, 2–6 months |
| Materials | $12,000 | $35,000 | $90,000 | Primary bid items and lead times |
| Subcontractors | $6,000 | $25,000 | $60,000 | Electrical, plumbing, specialty trades |
| Overhead | $4,000 | $15,000 | $40,000 | Allocated on cost base |
| Permits & Fees | $1,000 | $5,000 | $15,000 | Local jurisdiction requirements |
| Contingency | $2,000 | $10,000 | $25,000 | Risk buffer |
| Taxes | $500 | $5,000 | $15,000 | Sales/use taxes where applicable |
Labor hours and rate assumptions: typical crew mix and an hourly rate range of $50–$120 depending on skill level.
What Drives Price
Two niche-specific drivers are critical for unbilled work: contract measurement method and project complexity. First, if the contract uses milestone or percentage-of-completion, timing of revenue recognition and billings shifts unbilled amounts. Second, higher project complexity (multiple trades, unique site conditions) increases labor hours and material waste, expanding both unbilled costs and EEB.
Regional Price Differences
Prices for unbilled work and related accounting service can vary by region. In the West, higher construction wages tend to push unbilled labor costs up by roughly 5–12% versus the national average. The South often shows lower overhead allocations but similar material costs, resulting in net differences of about −3% to +6% in unbilled figures. In the Midwest, balancing labor and material costs typically yields a near-average delta of ±4% compared with national figures.
Cost Breakdown: Real-World Pricing Examples
Three scenario cards illustrate typical outcomes for different project scales and billing cadences. These samples show totals and per-unit considerations to aid budgeting and forecasting.
Basic Scenario
Specs: small commercial fit-out, 2–3 months, single-trade focus. Hours: 400–600. Totals: Unbilled costs $25,000–$40,000; EEB $8,000–$15,000. Billings: $20,000–$35,000. Assumptions: regional price moderate, simple scope.
Mid-Range Scenario
Specs: office build-out, 4–6 months, multiple trades. Hours: 1,200–1,800. Totals: Unbilled costs $60,000–$110,000; EEB $25,000–$60,000. Billings: $90,000–$150,000. Assumptions: standard market, common subcontracts.
Premium Scenario
Specs: healthcare facility, 9–12 months, high-complexity. Hours: 2,500–4,000. Totals: Unbilled costs $120,000–$200,000; EEB $70,000–$150,000. Billings: $180,000–$350,000. Assumptions: complex coordination, specialty trades.
Factors That Affect Price
Project lifecycle timing, billing cadence, and geographic variations are ongoing influencers. Delays in material lead times commonly raise unbilled costs and EEB until shipments arrive. Changes in scope or design revisions also alter both labor hours and material quantities, impacting the overall unbilled balance.
Ways To Save
Effective cost control for unbilled work focuses on forecast accuracy, clear milestone definitions, and proactive change management. Early procurement and lock-in of critical materials can reduce fluctuations in unbilled costs. Streamlining subcontractor coordination and improving time-tracking helps align billings with progress and reduces discrepancies.