Associated Builders and Contractors' (ABC) Construction Backlog Indicator (CBI) expanded by 1% to 8.5 months during the 2nd quarter of 2015. Backlog declined 3% during the 1st quarter, which was punctuated by harsh winter weather and the lingering effects of the West Coast ports slowdown. CBI stands roughly where it did a year ago, indicative of an ongoing recovery in the nation's nonresidential construction industry.
"The nation's nonresidential construction industry is now one of America's leading engines of growth," said ABC Chief Economist Anirban Basu. "The broader U.S. economic recovery is now in its 74th month, but remains under-diversified, led primarily by a combination of consumer spending growth as well as residential and nonresidential construction recovery. Were the overall economy in better shape, the performance of nonresidential construction would not be as closely watched. The economic recovery remains fragile despite a solid GDP growth figure for the second quarter, and must at some point negotiate an interest-rate tightening cycle. Recent stock market volatility has served to remind all stakeholders how delicate the economic recovery continues to be."
Regional Highlights
- The West experienced a significant expansion in backlog, rising 1.2 months following the resolution of the West Coast port slowdown, however backlog in the region remains nearly 2.5 months below its year-ago levels, the largest drop of any region.
- Backlog in the South has essentially returned to where it was two years ago, in part because of a slowdown in energy-related investment. The implication is that the average contractor remains busy, but boom-like conditions no longer prevail in energy-intensive communities.
- Despite this, backlog in the South continue to hold the longest average construction backlog.
- Backlog slipped for a second consecutive quarter in the Northeast, but remains above levels registered during the second half of 2013.
- See charts and graphs here.
Industry Highlights
- Backlog in the heavy industrial segment has never been higher during the length of the series, penetrating the seven-month mark for the first time. This represents an increase of more than two months in average backlog over the past two years. Average backlog was below five months during 2013's second half.
- Industrial backlog has continued to rise despite the strength of the U.S. dollar, which has contributed to limited export growth.
- Commercial/institutional backlog has remained above eight months on average for twelve consecutive quarters, a reflection of America's steady rate of employment expansion.
- Backlog for all industry segments is higher on a year-over-year basis with exception of the commercial/institutional segment. Commercial/institution construction segments have been among the most active from a construction spending perspective in recent years. Therefore, the small adjustment in average backlog is not particularly worrisome.
- See charts and graphs here.
Highlights by Company Size
- On a quarterly basis, backlog rose or remained flat across all firm sizes.
- Average construction backlog is higher or roughly the same as year-ago levels for firms of all size categories with the exception of a half-month drop in backlog among firms generating $100 million or more in annual revenues.
- The largest firms, however, continue to have the lengthiest average backlog at 10.7 months.
- See charts and graphs here.
Related Stories
Libraries | Mar 26, 2023
An abandoned T.J. Maxx is transformed into a new public library in Cincinnati
What was once an abandoned T.J. Maxx store in a shopping center is now a vibrant, inviting public library. The Cincinnati & Hamilton County Public Library (CHPL) has transformed the ghost store into the new Deer Park Library, designed by GBBN.
Multifamily Housing | Mar 24, 2023
Multifamily developers offering new car-free projects in car-centric cities
Cities in the South and Southwest have eased zoning rules with parking space mandates in recent years to allow developers to build new housing with less parking.
Multifamily Housing | Mar 24, 2023
Coastal multifamily developers, owners expect huge jump in insurance costs
In Texas and Florida, where Hurricane Ian caused $50 billion in damage last year, insurance costs are nearly 50% higher than in 2022.
Multifamily Housing | Mar 24, 2023
Average size of new apartments dropped sharply in 2022
The average size of new apartments in 2022 dropped sharply in 2022, as tracked by RentCafe. Across the U.S., the average new apartment size was 887 sf, down 30 sf from 2021, which was the largest year-over-year decrease.
Government Buildings | Mar 24, 2023
19 federal buildings named GSA Design Awards winners
After a six-year hiatus, the U.S. General Services Administration late last year resumed its esteemed GSA Design Awards program. In all, 19 federal building projects nationwide were honored with 2022 GSA Design Awards, eight with Honor Awards and 11 with Citations.
Healthcare Facilities | Mar 22, 2023
New Jersey’s new surgical tower features state’s first intraoperative MRI system
Hackensack (N.J.) University Medical Center recently opened its 530,000-sf Helena Theurer Pavilion, a nine-story surgical and intensive care tower designed by RSC Architects and Page. The county’s first hospital, Hackensack University Medical Center, a 781-bed nonprofit teaching and research hospital, was founded in 1888.
Project + Process Innovation | Mar 22, 2023
Onsite prefabrication for healthcare construction: It's more than a process, it's a partnership
Prefabrication can help project teams navigate an uncertain market. GBBN's Mickey LeRoy, AIA, ACHA, LEED AP, explains the difference between onsite and offsite prefabrication methods for healthcare construction projects.
Geothermal Technology | Mar 22, 2023
Lendlease secures grants for New York’s largest geothermal residential building
Lendlease and joint venture partner Aware Super, one of Australia’s largest superannuation funds, have acquired $4 million in support from the New York State Energy Research and Development Authority to build a geoexchange system at 1 Java Street in Brooklyn. Once completed, the all-electric property will be the largest residential project in New York State to use a geothermal heat exchange system.
Women in Design+Construction | Mar 21, 2023
Two leading women in construction events unite in 2023
The new Women in Residential + Commercial Construction Conference (WIR+CC) will take place in Nashville, Tenn., October 25-27, 2023. Combining these two long-standing events aligns with our mission to create an event most impactful for women in the $1.4 trillion U.S. commercial and residential design and construction industry.
Mass Timber | Mar 19, 2023
A 100% mass timber construction project is under way in North Carolina
An office building 100% made from mass timber has started construction within the Live Oak Bank campus in Wilmington, N.C. The 67,000-sf structure, a joint building venture between the GCs Swinerton and Wilmington-headquartered Monteith Construction, is scheduled for completion in early 2024.