Construction Backlog Declines in October - Modern Distribution Management

Log In

Construction Backlog Declines in October

After surpassing its pre-pandemic level in September, backlog is now back below the reading observed at the start of the pandemic, according to ABC.
Silhouette engineer standing orders for construction crews to wo

The construction backlog indicator declined to 8.8 months in October from nine months in September, according to a member survey conducted Oct. 20 to Nov. 4 by Associated Builders and Contractors (ABC).

The reading is up 0.7 months from October 2021. After surpassing its pre-pandemic level in September, backlog is now back below the reading observed at the start of the pandemic (8.9 months in February 2020), according to ABC, which also analyzes federal data related to construction.

Backlog in the commercial and institutional segment fell from 9.4 in September to 8.8 in October, its largest monthly decline since July 2020, and is now 0.4 months below pre-pandemic levels, according to ABC.

ABC’s Construction Confidence Index readings for sales, profit margins and staffing levels all remained above the threshold of 50, indicating expectations for growth over the next six months.

“October’s survey data hinted at some emerging weakness in the nation’s nonresidential construction sector,” ABC Chief Economist Anirban Basu said. “While the industry continues to gain strength from significant funding for public work, pandemic-induced behavioral shifts — including remote work and online business meetings as well as surging borrowing costs — are translating into meaningful declines in backlog in commercial and institutional segments.

“With borrowing costs likely to increase during the coming months and materials prices set to remain elevated, industry momentum could easily downshift further in 2023. But it is also conceivable that certain economists are overly pessimistic. There is still underlying momentum in the U.S. economy, and some believe that near-term recession is not inevitable. Contractor survey data indicate that while backlog declined in October, it remains reasonably healthy. Moreover, the average contractor continues to expect sales, staffing and margins to grow over the next six months. Time will tell whether this lingering optimism is justified.”

Related Posts

Share this article

About the Author
Recommended Reading
Leave a Reply

Leave a Comment

Sign Up for the MDM Update Newsletter

The MDM update newsletter is your best source for news and trends in the wholesale distribution industry.

Get the MDM Update Newsletter

Wholesale distribution news and trends delivered right to your inbox.

Sign-up for our free newsletter and get:

  • Up-to-date news in a quick-to-read format
  • Free access to webcasts, podcasts and live events
  • Exclusive whitepapers, research and reports
  • And more!


articles left

Want more Premium content from MDM?

Subscribe today and get:

  • New issues twice each month
  • Unlimited access to, including 10+ years of archived data
  • Current trends analysis, market data and economic updates
  • Discounts on select store products and events

Subscribe to continue reading

MDM Premium Subscribers get:

  • Unlimited access to
  • 1 year digital subscription, with new issues twice a month
  • Trends analysis, market data and quarterly economic updates
  • Deals on select store products and events



You have one free article remaining

Subscribe to MDM Premium to get unlimited access. Your subscription includes:

  • Two new issues a month
  • Access to 10+ years of archived data on
  • Quarterly economic updates, trends analysis and market data
  • Store and event discounts

To continue reading, you must be an MDM Premium subscriber.

Join other distribution executives who use MDM Premium to optimize their business. Our insights and analysis help you enter the right new markets, turbocharge your sales and marketing efforts, identify business partners that help you scale, and stay ahead of your competitors.

Register for full access

By providing your email, you agree to receive announcements from us and our partners for our newsletter, events, surveys, and partner resources per MDM Terms & Conditions. You can withdraw consent at any time.

Learn More about Custom Reports

Request a Market Prospector Demo

  • This field is for validation purposes and should be left unchanged.