ABC: Construction Backlog Indicator Rises in July
Key Highlights
- Backlog in July rose to 8.8 months, up 0.4 months from the previous year, driven by data center and infrastructure projects
- Contractor confidence declined, with profit margin expectations at their lowest since October 2024
- Over 80% of ABC members reported tariff-related price increases, affecting profit margins and project costs.
WASHINGTON, DC — Associated Builders and Contractors reported today that its Construction Backlog Indicator rose to 8.8 months in July, according to an ABC member survey conducted July 24 to Aug. 4. The reading is up 0.4 months since July 2024.
Backlog is up on a year-over-year basis in every region except for the South. Despite the lack of growth, backlog in the South remains significantly longer than in any other region.
ABC’s Construction Confidence Index reading for sales and profit margins declined in July, while the reading for staffing levels rose to the highest level since April. The readings for all three components remain above the threshold of 50, indicating expectations for growth over the next six months.
“Backlog continued to rise in July despite the ongoing decline in construction spending,” said ABC Chief Economist Anirban Basu. “Some of that strength can be attributed to the fact that 1 in every 8 ABC members is currently under contract to perform work on a data center project. Backlog in the infrastructure category has also increased considerably over the past year, and public construction activity has outperformed the private sector over the past several months.
“While backlog rose, contractor confidence slipped in July, especially with regards to profit margins,” said Basu. “Fewer than 2% of ABC members expect their profit margins to increase significantly over the next six months, the fewest since October 2024. This is likely due to trade policy and the recent acceleration in materials price escalation; more than 80% of ABC members have been notified of tariff-related price increases.”
Note: The reference months for the Construction Backlog Indicator and Construction Confidence Index data series were revised on May 12, 2020, to better reflect the survey period. CBI quantifies the previous month's work under contract based on the latest financials available, while CCI measures contractors' outlook for the next six months. View the methodology for both indicators.
View ABC’s Construction Backlog Indicator and Construction Confidence Index tables for July, or view the full Construction Backlog Indicator and Construction Confidence Index data seriesby visiting abc.org/economics.