Associated Builders and Contractors’ construction backlog indicator rose to 8.7 months in September, up 0.2 months from August and from a year earlier. It’s the second straight monthly gain, and ABC says data center work is doing most of the lifting.
ABC released the reading Oct. 13 from a member survey that ran Sept. 21 to Oct. 5. The headline number is fine. The breakdown in ABC’s published data series is less tidy.
Construction backlog by sector and region
Commercial and institutional backlog climbed to 9.0 months, the highest since July 2025, after sagging to 8.0 in July. Heavy industrial slipped to 8.1 months, its lowest since March, though it’s still 0.5 months above a year ago. Infrastructure fell from 10.0 months to 9.4.
The South led the regions at 10.3 months. The Middle States went the other way, dropping from 7.9 months to 6.7, the weakest reading there since September 2023.
Data center backlog and the contractor size split
ABC chief economist Anirban Basu said the 15% of members under contract on data centers averaged 11.3 months of backlog, three months more than everyone else. He said 39% of contractors with more than $100 million in annual revenue have data center work, against about 1 in 10 below that line. In August, ABC put the data center share at 1 in 6, so the share of members doing the work hasn’t grown.
The size bands don’t line up neatly with that story. Firms with $50 million to $100 million in revenue reported 11.3 months, their best since November 2024. The largest firms, the group Basu says holds most of the data center work, came in at 11.8 months, their lowest since May 2025. And contractors with $30 million to $50 million in revenue fell from 8.9 months to 6.4, the lowest reading for that band since early 2011.
Subgroup samples are small, and one month’s swing isn’t a trend. A 2.4-month drop in a single band is still a number to keep in mind if you’re bidding against midsize regional firms that may be hungry for work.
Contractor confidence on sales and margins
ABC’s confidence index moved against backlog. The sales reading fell to 60.1 from 62.0, an 11-month low. Profit margins dipped to 52.0 from 52.9. Staffing rose to 60.7 from 59.5. All three are still above 50, the line between expected growth and contraction.
The margin detail is the one that matters. In the survey, 26.3% of respondents expect margins to shrink over the next six months, the largest share since November 2025, and Basu tied that to rising materials, labor and borrowing costs. The margin index bottomed at 51.1 that month. It’s 0.9 points above that floor now.
Rising backlog and falling margin expectations in the same month tend to mean the new work was bought on price. October’s survey will show whether contractors keep taking it on those terms.