On April 11, Associated Builders and Contractors announced that its Construction Backlog Indicator declined to 8.7 months in March, according to a member survey conducted March 20 to April 3. ABC said the reading is 0.4 months higher than in March 2022.
ABC said backlog decreased in March and is now at its lowest level since August 2022. The average backlog increased to 9.2 months in February from nine months in January.
Backlog also is down on a monthly basis in every region except for the South, which continues to be associated with “elevated levels of current and future construction activity,” ABC said.
“The deceleration in nonresidential construction activity may have started,” said ABC Chief Economist Anirban Basu. “With widespread fears of recession, credit conditions tightening and more decision-makers turning their attention to cost containment, new construction work may be more difficult for contractors to line up. While the confidence and backlog data weakened in March, they indicate a slowing of activity rather than a shift into reverse,” said Basu. “There is a widely held view that financial conditions are tightening in the aftermath of the failures of Silicon Valley Bank and Signature Bank. To the extent that this is true, one could anticipate further slowing and less industry confidence during the months ahead.”