July 13, 2011

A bigger lie than statistics? Forecast?

In our company we once in a while buy some forecasts. Obviously when working in the field of construction, we want to know what is actually happening in that sector. The most comprehensive package from our main market place, Western Europe, is so called Euroconstruct -statistics. It is a combination of work from multiple statistical bodies from Western European countries.

Now it is time for summer holidays and I even had some time to read the latest information from June this year. The book is not as thick as Bible and even had some nice (statistical) pictures in it = good summer reading.

What was the outcome of my reading? Here are some of my learnings:

1) Nobody wants to be optimistic about their market performance. All forecasters got multiple blacks eyes during the last two years, so nobody wants to be optimistic now.

2) Construction output is linked with GDP growth expectations, see e.g. graph above. What a big surpise !

3) Look at all graphs at least twice and check their scale - e.g. graph above, GDP growth rate 1% and construction growth 2% scale -the picture would be very different only when putting the scales to be same. Conclusion: the guy who made this graph was an pessimistic one....

Please do not take me wrong - there were also very valuable data from Euroconstruct figures. But of course I will not reveal this - also competitors of us might read this blog. But what is sure it certainly requires skills to get data from forecasts which really can be used for business.

Enjoy your summer and please select better books to read !

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