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Dive brief:
- The construction backlog increased to 8.8 months in April, a maximum of 10 months for contractors, according to Associated Builders and Contractors.
- Growth remains highly concentrated among construction companies with more than $100 million in annual revenue, particularly for those with data center contracts. All other contractor size categories have smaller backlogs than a year ago, according to the report.
- “While the backlog widened to a 10-month high in April, recent industry momentum is highly concentrated among a subset of contractors,” said Anirban Basu, ABC’s chief economist. “Booming data center construction has almost exclusively benefited ABC’s largest members.”
Diving knowledge:
Large contractors with artificial intelligence work are pulling away from the rest of the construction industry, according to the latest delay data.
For example, 42% of contractors with more than $100 million in annual revenue are under contract to work there data center projectscompared to only 7% of contractors with less than $100 million in annual revenue.
According to ABC, contractors contracted to work in data centers are about 12.2 months behind schedule. That’s about four months longer than contractors without those jobs, Basu said.
However, while smaller builders are seeing a slowdown in new projects, they have remained consistently upbeat, with the outlook for sales, profit margins and staffing levels rising over the past month, regardless of the major macroeconomic headwinds affecting the sector. ABC’s construction confidence index, which measures builders’ outlook over the next six months, rose across the board.
“The result is this weak construction spending datathe recent rise in the price of oil and the emerging price escalation of materials “They have not diminished the confidence of ABC members,” Basu said. “Just one in five expect their profit margins to shrink over the next six months, the lowest amount since January 2025, and contractors are equally upbeat about their sales and staffing levels.”
