Construction Backlogs Fall to Four-Year Low

Construction Backlogs Fall to Four-Year Low

U.S. construction project backlogs declined to a four-year low in January, signaling continued softness in demand across several property sectors, according to new data from the Associated Builders and Contractors (ABC).

The trade group reported that contractors are carrying an average of eight months of work under contract but not yet started. That figure fell by 0.2 months from December and by 0.4 months compared with January 2025, ABC said Tuesday.

Backlog levels varied by sector. Infrastructure projects — including roads and bridges — remained the strongest, with an average backlog of 10 months. Commercial and institutional projects stood at 8.1 months, while heavy industrial developments lagged at 5.8 months.

Although numerous U.S. manufacturing projects have been announced over the past year by technology and pharmaceutical companies, many have yet to advance to the construction contracting phase, limiting their near-term impact on backlog totals.

Despite the slowdown, contractor sentiment remains relatively optimistic. About 64% of contractors surveyed expect sales to increase over the next six months, and 52% anticipate adding staff. However, only 36% expect profit margins to improve, reflecting ongoing cost pressures and competitive pricing conditions.