Associated Builders and Contractors reported that its Construction Backlog Indicator declined to 8.1 months in February, according to an ABC member survey conducted Feb. 20 to March 5. The reading is down 1.1 months from February 2023.
Backlog fell for every size of contractor except for those with under $30 million in annual revenues in February. Over the past year, however, the largest contractors—those with greater than $50 million in revenues—have experienced the greatest decline in backlog.
ABC’s Construction Confidence Index readings for sales, profit margins and staffing levels also decreased in February. However, all three readings remain above the threshold of 50, indicating expectations for growth over the next six months.
“Backlog is declining and confidence began to fade modestly in February,” said ABC Chief Economist Anirban Basu. “While it is far too early to predict an industrywide downturn given that confidence readings continue to signal growth along sales, employment and profit margin dimensions, it appears that a rising tide of project cancellations and postponements has begun to make its mark.
“With excess inflation remaining stubbornly durable, at least according to certain measures, interest rates are poised to remain higher for longer,” said Basu. “That gives higher borrowing costs more time to upset the economic momentum that has so surprised economists over the past two years and has provided support for various nonresidential construction activities. With so much federal money still entering the economy, there will continue to be support for growth in certain construction segments, including public works and manufacturing-related megaprojects, but industry weakness is more apparent in segments that rely more purely on private financing.”
Related Stories
Healthcare Facilities | Jun 20, 2022
Is telehealth finally mainstream?
After more than a century of development, telehealth has become a standard alternative for many types of care.
Building Team | Jun 20, 2022
Andres Caballero Appointed President of Uponor North America
Uponor Corporation (Uponor) has named Andres Caballero president of its Building Solutions – North America division and a member of the Executive Committee at Uponor.
| Jun 20, 2022
An architectural view of school safety and security
With threats ranging from severe weather to active shooters, school leaders, designers, and security consultants face many challenges in creating safe environments that allow children to thrive.
School Construction | Jun 20, 2022
A charter high school breaks ground in L.A.’s Koreatown
A new charter school has broken ground in Los Angeles’ Koreatown neighborhood.
Building Team | Jun 17, 2022
Data analytics in design and construction: from confusion to clarity and the data-driven future
Data helps virtual design and construction (VDC) teams predict project risks and navigate change, which is especially vital in today’s fluctuating construction environment.
Sports and Recreational Facilities | Jun 17, 2022
U. of Georgia football facility expansion provides three floors for high-performance training
A major expansion of the University of Georgia’s football training facility has been completed.
Building Team | Jun 16, 2022
Hybrid work expected to reduce office demand by 9%
Businesses are slowly but consistently transitioning to a permanent hybrid work environment, according to a senior economist at Econometric Advisors.
Building Team | Jun 16, 2022
USGBC announces more than 23 million square feet of LEED certified net zero space
Today, the U.S. Green Building Council announced nearly 100 net zero certifications earned under the LEED Zero program, representing more than 23 million square feet of space.
AEC Business Innovation | Jun 15, 2022
Cognitive health takes center stage in the AEC industry
Two prominent architecture firms are looking to build on the industry’s knowledge base on design’s impact on building occupant health and performance with new research efforts.
Market Data | Jun 15, 2022
ABC’s construction backlog rises in May; contractor confidence falters
Associated Builders and Contractors reports today that its Construction Backlog Indicator increased to nine months in May from 8.8 months in April, according to an ABC member survey conducted May 17 to June 3. The reading is up one month from May 2021.
