Associated Builders and Contractors’s Construction Confidence Index readings for sales, profit margins and staffing levels decreased in February, but all three readings were above the threshold of 50, indicating expectations for growth over the next six months.
Meanwhile, the ABC's Construction Backlog Indicator declined to 8.1 months in February, which is 1.1 months lower than February 2023. Over the past year, contractors with greater than $50 million in revenues have experienced the greatest decline in backlog.
“Backlog is declining, and confidence began to fade modestly in February,” said ABC Chief Economist Anirban Basu in a statement. “While it is far too early to predict an industrywide downturn given that confidence readings continue to signal growth along sales, employment and profit margin dimensions, it appears that a rising tide of project cancellations and postponements has begun to make its mark." He cited "stubbornly durable" inflation as a factor that is keeping interest rates higher and continuing to "upset the economic momentum."
