Associated Builders and Contractors reported today that its Construction Backlog Indicator climbed to nine months in August 2019, up 0.5 months or 5.4% from July 2019, when CBI stood at 8.5 months.
“Despite some other leading indicators suggesting weakening in nonresidential construction spending, our most recent backlog readings show that contractors are still experiencing significant demand for construction services” said ABC Chief Economist Anirban Basu. “The primary issue for most contractors is not a lack of demand, but an ongoing and worsening shortage of skilled workers available to meet contractual requirements.
“Though this month’s report was generally positive, softening activity in the nation’s manufacturing sector is becoming more apparent in construction data,” said Basu. “Specifically, backlog in the heavy industrial category slipped to 7.7 months in August, a decline of 12%. A number of key manufacturing indicators have been weakening of late, including capacity utilization and the Institute for Supply Management’s index for manufacturing. It appears that the slowdown in factory activity is now being reflected in construction spending data.
“By contrast, backlog for those involved in heavy highway projects or other forms of infrastructure reached 10.4 months, an increase of nearly 13%,” said Basu. “The implication is that state and local governments are leveraging stronger fiscal positions and lower borrowing costs to move forward with more infrastructure projects. Not only is this a source of strength for the U.S. economy, it is helping to support overall nonresidential construction spending. Growing contractual volume in the infrastructure category helped to push backlog among Middle States contractors up to 8.8 months, a 1.8-month gain. Overall, backlog continues to be lengthiest in the South and West.”
Related Stories
Market Data | Aug 31, 2021
Three out of four metro areas add construction jobs from July 2020 to July 2021
COVID, rising costs, and supply chain woes may stall gains.
Market Data | Aug 24, 2021
July construction employment lags pre-pandemic peak in 36 states
Delta variant of coronavirus threatens to hold down further gains.
Market Data | Aug 17, 2021
Demand for design activity continues to expand
The ABI score for July was 54.6.
Market Data | Aug 12, 2021
Steep rise in producer prices for construction materials and services continues in July.
The producer price index for new nonresidential construction rose 4.4% over the past 12 months.
Market Data | Aug 6, 2021
Construction industry adds 11,000 jobs in July
Nonresidential sector trails overall recovery.
Market Data | Aug 2, 2021
Nonresidential construction spending falls again in June
The fall was driven by a big drop in funding for highway and street construction and other public work.
Market Data | Jul 29, 2021
Outlook for construction spending improves with the upturn in the economy
The strongest design sector performers for the remainder of this year are expected to be health care facilities.
Market Data | Jul 29, 2021
Construction employment lags or matches pre-pandemic level in 101 metro areas despite housing boom
Eighty metro areas had lower construction employment in June 2021 than February 2020.
Market Data | Jul 28, 2021
Marriott has the largest construction pipeline of U.S. franchise companies in Q2‘21
472 new hotels with 59,034 rooms opened across the United States during the first half of 2021.
Market Data | Jul 27, 2021
New York leads the U.S. hotel construction pipeline at the close of Q2‘21
Many hotel owners, developers, and management groups have used the operational downtime, caused by COVID-19’s impact on operating performance, as an opportunity to upgrade and renovate their hotels and/or redefine their hotels with a brand conversion.