Economic Outlook
ABC's Backlog Indicator Hits Four-Year Low
Backlog fell 0.2 months since December 2025.
The Associated Builders and Contractors’ Construction Backlog Indicator fell to a four-year low in January, declining 0.2 months since December, with a reading of 8 months. Since January 2025, backlog has shrunk 0.4 months.
By category, infrastructure has the strongest backlog at 10 months, up 2 months year-over-year and 0.9 months since December, while commercial and institutional and heavy industrial backlogs both experienced yearly and monthly declines.
Despite this, “Contractors remain shockingly sanguine about the near-term outlook,” said ABC Chief Economist Anirban Basu in a statement. “Just 13% of contractors expect their sales to decrease over the next six months, the smallest share since February 2022.”
Participants in ABC’s Construction Confidence Index survey reported increased expectations for all three categories— sales, profit margins and staffing—since December. However, said Basu, “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.”
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