Backlog rebounds, remains lopsided across construction

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Dive Temporary:

• Building backlog bounced back from a four-year low in February, however massive development firms and data center builds accounted for a lopsided share of these wins, based on Related Builders and Contractors. 
• Backlog rose a tenth of a degree in February to eight.1 months for the business, however contractors with over $100 million in income reported 12.1 months of labor. In the meantime, builders with knowledge heart contracts had 11.2 months of labor on their books, whereas these with out jobs within the sector languished at 7.6 months. Industrywide, year-over-year backlog dropped by 0.2 months. 
• That divide between haves and have-nots might solely widen going ahead. “Whereas knowledge heart work ought to proceed apace over the following few quarters, the battle in Iran … might suppress demand for different types of development work resulting from elevated supplies costs, borrowing prices and uncertainty,” stated Anirban Basu, ABC chief economist, in a information launch. 

Dive Perception:

Regionally, the Center States noticed the biggest features, with backlog rising by a full month from January to February. 12 months over yr, the area posted the one achieve nationally, rising by 1.2 months. That displays a continued restoration within the space because the pandemic. 

“It’s notable that backlog progress has been confined to the Center States area,” Basu stated. “After struggling within the rapid aftermath of the pandemic, the Midwest has posted surprisingly robust inhabitants and financial progress over the previous yr, and that progress has clearly translated into elevated ranges of development exercise.”

Whereas the industrial and institutional and heavy industrial sectors noticed month-over-month backlog will increase in February, the infrastructure phase gave again its stand-out features from January, dropping again to eight.9 months of labor from its earlier 10. 

Regardless of the uneven outcomes throughout sectors and areas, contractors remained largely upbeat. In response to the Building Confidence Index, which measures constructing professionals’ outlooks for the following six months, expectations for gross sales and hiring elevated. Though the projection for revenue margin progress got here in barely decrease in February than the earlier month, all three indicators remained above 50, indicating expectations of progress.

“Whereas contractors stay barely optimistic that their revenue margins will develop over the following six months, that confidence might not survive the latest and precipitous improve in oil costs,” stated Basu within the launch. “Rising enter prices, if persistent, may weigh on hiring expectations, which had been significantly upbeat in February. The CCI sequence for staffing stage expectations rose to the very best stage since March 2025.”