Associated Builders and Contractors reported that its Construction Backlog Indicator increased to 8.4 months in April, according to an ABC member survey conducted April 22 to May 6. The reading is down 0.5 months from April 2023, but expanded 0.2 months from the prior month.
Backlog declined on a monthly basis for the largest and smallest contractors by revenue and grew for those with $30-$50 million and $50-$100 million in annual revenues. On an annual basis, only contractors with $30-$50 million in annual revenues have experienced an increase in backlog.
ABC’s Construction Confidence Index readings for sales and profit margins fell slightly in April, while the reading for staffing levels improved. All three readings remain above the threshold of 50, indicating expectations for growth over the next six months.
“The Federal Reserve began ratcheting up interest rates more than two years ago but one would not know it based on construction confidence and backlog,” said ABC Chief Economist Anirban Basu. “ABC measurements reflect ongoing momentum in the nation’s nonresidential construction sector. While there are occasional hints of softness in certain segments and over certain periods, the average contractor continues to report solid backlog and a belief that sales, employment and profit margins will expand over the next six months.
“Time will tell whether this optimism is justified,” said Basu. “Coming into the year, many expected that interest rates would fall markedly in 2024. Given stubbornly elevated inflation, that will not occur. Project financing costs are poised to remain higher for longer. Project cancellations and postponements have been on the rise. Moreover, a new set of supply chain issues has emerged, driving up materials costs and prospectively weakening industry margins. Workers also are becoming more expensive, in part because the construction wage premium has shrunk over the past several years due to rapidly rising compensation levels in competing segments like logistics and retail. The implication is that construction compensation levels will need to rise for the industry to be able to staff up more fully."
Related Stories
| Jul 30, 2013
Top Healthcare Sector Construction Firms [2013 Giants 300 Report]
Turner, McCarthy, Clark Group top Building Design+Construction's 2013 ranking of the largest healthcare contractors and construction management firms in the U.S.
| Jul 26, 2013
Boldt opens Southern California office
Location is Boldt’s third in the state, will expand firm’s established presence on the west coast.
| Jul 26, 2013
How biomimicry inspired the design of the San Francisco Museum at the Mint
When the city was founded in the 19th century, the San Francisco Bay’s edge and marshland area were just a few hundred feet from where the historic Old Mint building sits today. HOK's design team suggested a design idea that incorporates lessons from the local biome while creating new ways to collect and store water.
| Jul 25, 2013
3 office design strategies for creating happy, productive workers
Office spaces that promote focus, balance, and choice are the ones that will improve employee experience, enhance performance, and drive innovation, according to Gensler's 2013 U.S. Workplace Survey.
| Jul 25, 2013
Rep. Burke, contractors welcome new Builders Association Executive Director
Illinois State Representative Kelly Burke and many of Chicagoland's leading contractors were on hand this week to welcome new Executive Director Dan McLaughlin to the Builders Association.
| Jul 25, 2013
How can I help you?: The evolution of call center design
Call centers typically bring to mind an image of crowded rows of stressed-out employees who are usually receiving calls from people with a problem or placing calls to people that aren’t thrilled to hear from them. But the nature of the business is changing; telemarketing isn’t what it used to be.
| Jul 25, 2013
First look: Studio Gang's residential/dining commons for University of Chicago
The University of Chicago will build a $148 million residence hall and dining commons designed by Studio Gang Architects, tentatively slated for completion in 2016.
| Jul 25, 2013
ACEEE presents the 2013 Champions of Energy Efficiency in Industry Awards
The American Council for an Energy-Efficient Economy (ACEEE) presented four Champion of Energy Efficiency Awards last night at its Summer Study on Energy Efficiency in Industry.
| Jul 23, 2013
Paul Bertram to speak at ACEEE Summer Study on Energy Efficiency
Paul Bertram, FCSI, CDT, LEED AP and director of environment and sustainability for Kingspan Insulated Panels N.A., will present a white paper during the American Council for an Energy Efficient Economy (ACEEE) 2013 Summer Study on Energy Efficiency in Industry.
| Jul 22, 2013
School officials and parents are asking one question: Can design prevent another Sandy Hook? [2013 Giants 300 Report]
The second deadliest mass shooting by a single person in U.S. history galvanizes school officials, parents, public officials, and police departments, as they scrambled to figure out how to prevent a similar incident in their communities.