Construction backlog has reached its highest point since September 2023, based on a recent report from the Associated Builders and Contractors.
Construction backlog rose to its highest level since September 2023, according to a recent survey issued by the Associated Builders and Contractors.
According to the ABC’s Construction Backlog Indicator, the backlog climbed to 8.7 months in April—a 20-month peak—based on a survey of members conducted between April 22 and May 6. This marks a 0.3-month increase from April 2024 and continues a strong upward trend over the past year, particularly among contractors with annual revenues exceeding $100 million.
Smaller contractors have also seen a slight increase in backlog, though those with annual revenues between $30 million and $100 million have experienced a year-over-year decline.
In April, ABC’s Construction Confidence Index showed an improvement in profit margin expectations, while confidence in sales and staffing levels declined. Despite the dip, the sales outlook remains stronger than it was a year ago. All three index components stayed above the 50-point mark, signaling continued expectations for growth over the next six months.
ABC Chief Economist Anirban Basu noted that even with the record-high backlog, many members experienced project delays or cancellations in April due to tariffs.
“Nearly 22% of contractors had a project delayed or canceled in April due to tariffs, up from 18% in March, while 87% have been notified of tariff-related materials prices increases,” Basu said. “Contractors remain busy despite these headwinds; backlog rose in April and is now at the highest level since September 2023. While ABC members remain upbeat about the near-term outlook, the share of respondents that expect their sales to decline over the next six months rose to 19% in April, up 6 percentage points since the start of the year.”
Data center construction continues to dominate the construction industry. The Dodge Momentum Index, a 12-month leading indicator for construction spending specifically focused on nonresidential buildings, grew 0.9% in April predominantly thanks to data center ramp-ups. The DMI would have dropped 3% and commercial planning 2.3% were it not for those projects.
“Despite an uptick in April, the bulk of the DMI’s growth was driven by a surge in data center planning, while momentum in other nonresidential sectors lagged behind,” Sarah Martin, associate director of forecasting at Boston-based Dodge Construction Network, told Construction Dive. “Owners and developers are navigating heightened economic and policy uncertainty, which likely bogged down much of this month’s planning activity.”
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