Contractors surveyed by Associated Builders and Contractors say expectations for growth in profit margins has fallen, according to the group’s Construction Confidence Index. The index threshold is 50, and confidence for profit margins sat at 49.1 in August.
“As predicted, confidence among contractors is slipping,” said chief economist Anirban Basu in a statement. “While ABC contractor members are still anticipating expanding sales and employment, profits margins are increasingly under pressure as project owners face high borrowing and construction delivery costs in the context of a slowing economy. Many projects have been postponed, resulting in recent backlog declines, most notably in the South.”
ABC’s Construction Backlog Indicator fell to 8.2 months in August, down 1.0 months from August 2023.
Only the infrastructure category experienced a monthly increase in backlog among the three major segments, reflecting strength in public construction spending. Nonetheless, over the past year, backlog has declined in all three segments.
