ABC Backlog Indicator Rises in March, Already Reflecting Tariff Impacts

On Tuesday, Associated Builders and Contractors (ABC), a national construction industry trade association with more than 23,000 members, reported that its Construction Backlog Indicator increased to 8.5 months in March, up 0.3 months from a year ago. ABC members were polled between March 20 and April 6.

The backlog increased on a monthly basis for all nonresidential subsegments. Over the past year, however, only the infrastructure category has experienced a meaningful increase in backlog.

ABC also reported the results of its Construction Confidence Index (CCI) for April. The CCI reading for staffing improved, while the readings for sales and profit margins fell. The readings for all three components remain above the threshold of 50, indicating expectations for growth over the next six months.

Notably, respondents who completed the survey after the April 2 tariffs announcement were significantly less upbeat—fewer than 26% of those respondents expected their profit margins to expand over the next six months, while more than 40% expected them to contract.

Commenting on the report, ABC Chief Economist Anirban Basu said:

“Backlog increased in March and contractors remained optimistic regarding the future, but this largely reflects contractor activity and sentiment prior to April 2, when the most consequential economic policy in several decades was announced.

Approximately 80% of ABC contractors surveyed indicate that suppliers have notified them of tariff-related materials price increases, and nearly 20% of contractors surveyed had projects paused or interrupted because of tariffs during March. These tariffs have already materially diminished the outlook for construction activity in 2025. Many businesses are poised to delay or even cancel planned capital investments given the current business environment and daily market convulsions. Conditions will likely deteriorate further if elevated tariff rates remain in place for any meaningful length of time.”