Backlogs Fall, Optimism Builds in Construction Sector

WASHINGTON, Feb. 10—Associated Builders and Contractors reported today that its Construction Backlog Indicator fell to 8.0 months in January, according to an ABC member survey conducted Jan. 20 to Feb. 3. The reading is down 0.2 months from December and 0.4 months from January 2025.

View ABC’s Construction Backlog Indicator and Construction Confidence Index for January. View the full Construction Backlog Indicator and Construction Confidence Index data series.

Backlog continues to hold up better for larger contractors, rising over the past year for contractors with greater than $50 million in annual revenues while falling sharply for those with revenues below that threshold. 

ABC’s Construction Confidence Index reading for sales, profit margins and staffing levels increased again in January. Sales expectations are better than they were one year ago, while profit margin and staffing expectations are slightly worse. The readings for all three components remain above the threshold of 50, indicating expectations for growth over the next six months.

“Backlog fell to a four-year low in January, yet contractors remain shockingly sanguine about the near-term outlook,” said ABC Chief Economist Anirban Basu. “Just 13% of contractors expect their sales to decrease over the next six months, the smallest share since February 2022. Despite that personal confidence, ABC members are far less optimistic about their competition; 46% of contractors expect that other contractors will see their sales decline over the next two quarters. Whether or not this personal optimism is justified will likely depend on the extent to which borrowing costs can decline in 2026.”

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 themethodologyfor both indicators.

Visit abc.org/economics for the Construction Backlog Indicator and Construction Confidence Index, plus analysis of spending, employment, job openings and the Producer Price Index.

Associated Builders and Contractors is a national construction industry trade association established in 1950 with 67 chapters and more than 23,000 members. Founded on the merit shop philosophy, ABC helps members offer a robust employee value proposition, develop people, win work and deliver that work safely, ethically and profitably for the betterment of the communities in which ABC and its members work. Visit us at abc.org.