Large Projects Hold Up Backlog as Small-Firm Activity Slips, ABC Says

Backlog slipped once more in October, with Associated Builders and Contractors reporting an 8.4-month common primarily based on member responses from Oct. 20 to Nov. 4. The studying is the bottom since Might and marks the third consecutive month-to-month decline after peaking in July, in response to ABC’s knowledge sequence.

The pullback continues to fall hardest on smaller corporations. Contractors with lower than $30 million in annual income reported 7.29 months of backlog in October, down greater than a full month from August.

Bigger corporations tied to manufacturing and data-center building stay the stabilizing pressure: contractors lively in data-center tasks reported 10.9 months of backlog, in contrast with 8.0 months for these with out that work.

ABC knowledge reveals regional results widened because the backlog within the Northeast continued its regular decline that started in July, falling from 8.11 months to 7.65 in October.

The Center States retreated after a late-summer excessive, whereas the West rebounded to eight.12 months following a weak September. The South continued to put up the strongest readings, hovering close to 9.6–11.2 months all through the interval.

ABC’s confidence readings confirmed the identical softening, with gross sales expectations unchanged in October, however outlooks for revenue margins and staffing each declined.

All three indices remained above 50, indicating corporations nonetheless anticipate development into early 2026 however with tighter margins and extra cautious hiring.

“Practically 65% of contractors indicated that they assume the U.S. building trade is contracting,” stated ABC Chief Economist Anirban Basu. He famous that 23% of surveyed corporations anticipate gross sales to fall within the subsequent six months, the very best share in additional than a 12 months.

The mix of a three-month backlog and weaker margin expectations alerts extra aggressive bidding circumstances as corporations work to take care of workloads by means of the winter.