The Money You've Already Earned
Once, an owner walked me through a job that was a success by every measure that comes up in conversation. Clean work, the inspector signed off, the client was thrilled. Then I asked when he'd get paid for the extra work his crew did in weeks three and four, and the room went quiet. Nobody had signed anything. The work was real. The cost was real. The paper that turns it into money didn't exist.
Two things drain cash out of electrical contractors in ways the P&L is slow to show. Both are revenue you've genuinely earned and haven't collected. One is change-order work done before it's approved. The other is public and prevailing-wage work that pays reliably but slowly. Neither reads as a loss on any statement. Both quietly finance somebody else's project with your money.
The change order you did on a handshake
Your crew is on site, the GC or the customer points at something outside the scope, and asks you to take care of it. You take care of it, because the job has momentum and stopping to chase paperwork feels small. Then you learn what that instinct costs.
Industry research on specialty-contractor change orders in 2025 and 2026 is grim on this point. One report found the average time from submitting a change order to getting it signed runs around 26 days, with a large share of trade contractors waiting 3 weeks or more for authorization. Worse, a majority of firms said they write down or write off change-order revenue at least sometimes, usually because the backup wasn't there or the price was never agreed. You did the work, you carried the labor and the material, and some real fraction of it you never bill or never collect.
The fix is unglamorous and it holds. No extra work moves without a signed authorization, even a photographed one-line approval on a phone, before the crew touches it. It slows you down by minutes. It's the line between billable work and a gift.
Prevailing wage pays. It just pays late.
Public work is good work. It's steady, the wage is set, and the check clears. What it does to your cash is another matter. Certified-payroll and prevailing-wage jobs carry a heavier labor burden and a slower, documentation-heavy billing cycle, and the money lags your payroll by weeks you have to fund yourself.
The burden is bigger than most owners estimate. Payroll-compliance writers in 2025 note that prevailing wage can add 20 to 40 percent to your fully burdened labor rate, and describe a journeyman at a 42-dollar base actually costing well into the 50s and low 60s an hour once fringe is loaded on. You front all of that every week. Meanwhile the payment chain drags. One widely cited figure has 71 percent of subcontractors dealing with slow payments from general contractors, and on public jobs a single late certified-payroll report anywhere on the project can freeze the entire billing cycle, yours included. So the money is coming, and you're the bank until it does. That's fine if you planned to be the bank. It's a problem if you didn't.
Fund the gap on purpose
Both of these are the same problem wearing two coats. You've earned revenue your bank account hasn't seen yet, and the timing gap is real whether or not you ever named it.
Size it before it sizes you. Add up the change-order work sitting unsigned right now, and the prevailing-wage payroll you'll carry before the next draw lands. That figure is how much of your own capital is out on loan to your customers this month. Then decide, on purpose, how you cover it: a line of credit priced for exactly this, real approval discipline on change orders, and certified-payroll submission clean enough that nothing you control delays the check. The revenue was never in doubt. Timing is what puts good electrical contractors in a cash squeeze in the middle of their best year, and timing is the one part of this you can actually manage.