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Tariff pressure on construction costs led to an increase in project stress in November, according to the latest data from Cincinnati-based ConstructConnect.
The Project stress indexa measure of construction projects that have been delayed or abandoned, rose 19.9% from October to November. The increase pushes the benchmark to about 25.7 percent above its 2021 baseline, said Devin Bell, associate economist at ConstructConnect.
“Tariffs have played a key role in defining abandonment activity in both the public and private sectors this year,” Bell told Construction Dive. “As companies use up their pre-Liberation Day stocks months after the initial rates went into effect, rising construction costs are pushing some property owners and developers to cancel projects. This pressure is already visible in the high abandonments in the private sector, and both sectors continue to perform well above their historical averages.”
Dropouts rose 41.1% in November, the report said, marking one of the biggest monthly jumps in the index this year. Abandoned projects also rose significantly, up 16.5% in November. Delays in tender dates were the only indicator to improve, falling 2.9% after a rise the previous month.
The public and private division again showed divergent pressures. Pending private projects increased by 252.6% compared to the same period last year. Meanwhile, pending public activity fell 19% year-on-year, according to the report.
Private project abandonments rose 5.7% year-on-year in November, compared with a 3.2% drop in public abandonments.
“Both pending activity and abandonment increased substantially, pushing the index to its highest level since the June spike,” Bell told Construction Dive. “Rising material and operations costs have intensified the economic uncertainty facing the construction industry, pushing stress indicators higher.” Overall stressful conditions are now 9.9% higher than in the same period in 2024, according to the report. Bell said those high costs and lingering economic uncertainty will challenge viability of the project by 2026.
