Construction backlog rebounds in February

Associated Builders and Contractors’ (ABC) Construction Backlog Indicator increased to 8.1 months in February, an increase of 0.1 months compared to January, but down 0.2 months from February 2025.

The Washington-based association says backlog increased sharply during February in the middle states region, which consists of Illinois, Indiana, Iowa, Kansas, Michigan, Minnesota, Montana, Nebraska, North Dakota, Ohio, South Dakota and Wisconsin.

ABC added that the middle states region is the only region where backlog increased compared to 2025.

“Backlog bounced back from January’s four-year low, yet it remains subdued by historical standards,” ABC Chief Economist Anirban Basu says. “It’s notable that backlog growth has been confined to the middle states region. After struggling in the immediate aftermath of the pandemic, the Midwest has posted surprisingly strong population and economic growth over the past year, and that growth has clearly translated into increased levels of construction activity.”

ABC’s Construction Confidence Index readings for sales and staffing levels increased again in February, while the reading for profit margins fell. Sales expectations are better than they were one year ago, while profit margin and staffing expectations are slightly worse. The readings for all three components remain above the threshold of 50, indicating expectations for growth over the next six months.

“While contractors remain slightly optimistic that their profit margins will expand over the next six months, that confidence may not survive the recent and precipitous increase in oil prices,” Basu says. “Rising input costs, if persistent, could weigh on hiring expectations, which were particularly upbeat in February. The CCI series for staffing level expectations rose to the highest level since March 2025.”