ABC’s Backlog Indicator Hits Four-Year Low

The Related Builders and Contractors’ Development Backlog Indicator fell to a four-year low in January, declining 0.2 months since December, with a studying of 8 months. Since January 2025, backlog has shrunk 0.4 months.

By class, infrastructure has the strongest backlog at 10 months, up 2 months year-over-year and 0.9 months since December, whereas business and institutional and heavy industrial backlogs each skilled yearly and month-to-month declines.

Regardless of this, “Contractors stay shockingly sanguine in regards to the near-term outlook,” stated ABC Chief Economist Anirban Basu in an announcement. “Simply 13% of contractors anticipate their gross sales to lower over the subsequent six months, the smallest share since February 2022.”

Individuals in ABC’s Development Confidence Index survey reported elevated expectations for all three classes— gross sales, revenue margins and staffing—since December. Nonetheless, stated Basu, “ABC members are far much less optimistic about their competitors; 46% of contractors anticipate that different contractors will see their gross sales decline over the subsequent two quarters. Whether or not or not this private optimism is justified will probably depend upon the extent to which borrowing prices can decline in 2026.”