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
| Aug 11, 2010
10 tips for mitigating influenza in buildings
Adopting simple, common-sense measures and proper maintenance protocols can help mitigate the spread of influenza in buildings. In addition, there are system upgrades that can be performed to further mitigate risks. Trane Commercial Systems offers 10 tips to consider during the cold and flu season.
| Aug 11, 2010
Reed Construction Data files corporate espionage lawsuit against McGraw-Hill Construction Dodge
Reed Construction Data (RCD), a leading construction information provider and a wholly-owned subsidiary of Reed Elsevier (NYSE:RUK, NYSE:ENL), today filed suit in federal court against McGraw-Hill Construction Dodge, a unit of The McGraw-Hill Companies, Inc. (NYSE:MHP). The suit charges that Dodge has unlawfully accessed confidential and trade secret information from RCD since 2002 by using a series of fake companies to pose as RCD customers.
| Aug 11, 2010
NAVFAC releases guidelines for sustainable reconstruction of Navy facilities
The guidelines provide specific guidance for installation commanders, assessment teams, estimators, programmers and building designers for identifying the sustainable opportunities, synergies, strategies, features and benefits for improving installations following a disaster instead of simply repairing or replacing them as they were prior to the disaster.
| Aug 11, 2010
Construction employment shrinks in 319 of the nation's 336 largest metro areas in July, continuing months-long slide
Construction workers in communities across the country continued to suffer extreme job losses this July according to a new analysis of metropolitan area employment data from the Bureau of Labor Statistics released today by the Associated General Contractors of America. That analysis found construction employment declined in 319 of the nation’s largest communities while only 11 areas saw increases and six saw no change in construction employment between July 2008 and July 2009.
