Associated Builders and Contractors reported that its Construction Backlog Indicator fell to 8.4 months in October, according to an ABC member survey conducted Oct. 20 to Nov. 4. The reading is down 0.1 months since September but unchanged from October 2024.
View ABC’s Construction Backlog Indicator and Construction Confidence Index tables for October. View the full Construction Backlog Indicator and Construction Confidence Index data series.
Backlog was flat or increased on a monthly basis in each of the three industries considered in this survey. Backlog for respondents that do not primarily operate in any one industry—generally the smallest contractors responding to the survey—fell sharply for the month and stands at just 5.8 months.
ABC’s Construction Confidence Index reading for sales was unchanged in October, while the readings for profit margins and staffing levels declined. The readings for all three components remain above the threshold of 50, indicating expectations for growth over the next six months.
“Nearly 65% of contractors indicated that they think the U.S. construction industry is contracting, according to ABC’s October survey,” said ABC Chief Economist Anirban Basu. “This dismal assessment accompanied the lowest backlog reading since May, and 23% of contractors expect their sales to decline over the next six months, the highest share in over a year. These findings are consistent with an industry that is sustained by still-elevated manufacturing construction and a surging data center sector. Approximately 1 in 7 contractors are under contract to work on data centers, and those contractors have significantly higher backlog (10.9 months) than those that are not (8.0 months).”
Minority Of Metro Areas Add Construction Jobs From August 2024 To August 2025 As Tariffs, Worker Shortages, Financing Costs Slow Demand
For the first time since 2021, fewer than half of the nation’s metro areas added construction jobs between August 2024 and August 2025, according to an analysis by the Associated General Contractors of America of new government employment data. Association officials noted that many private-sector developers appear to be putting projects on hold amid rising prices caused by tariffs, workforce shortages and higher interest rates.
“Construction employment has stalled or retreated in more and more areas as owners pull back on projects in the face of higher costs,” said Ken Simonson, the association’s chief economist. “Workforce shortages, tariffs and higher interest rates are inflating construction costs and schedules to the point where many projects no longer appear to make sense to developers.”
Only 177 metro areas or 49 percent added construction employees between August 2024 and August 2025. For the sixth-straight month, Arlington-Alexandria-Reston, Va.-W.Va. added the most construction jobs (8,200 jobs or 9 percent). The neighboring Washington, D.C.-Md. area was in second place with a gain of 6,600 jobs or 14 percent—the largest percentage increase of any area. Kokomo, Ind. also had a 14 percent gain, adding 300 construction jobs over 12 months.
Construction employment declined over the year in 125 metro areas and was unchanged in 58 areas. The largest job loss occurred in New York City (-7,900 jobs, -5 percent), followed by Riverside-San Bernardino-Ontario, Calif. (-6,500 jobs, -6 percent); Los Angeles-Long Beach-Glendale, Calif. (-6,000 jobs, -6 percent); and Baton Rouge, La. (-5,700 jobs, -11 percent). The largest percentage decrease occurred in Baton Rouge, followed by Lake Charles, La. (-9 percent, -1,000 jobs) and two areas with losses of 8 percent (-100 jobs): Walla Walla, Wash. and Hanford-Corcoran, Calif.
A separate government report showed there were 188,000 job openings in construction, seasonally adjusted, at the end of August—a 38 percent decline from a year earlier and the lowest total since 2017. This decline suggests even fewer areas are likely to have construction employment increases in the near future, Simonson said. A prolonged federal shutdown could also impact construction employment if public works projects are suspended or fail to get needed approvals to start because federal officials are unavailable to sign off, he added.
Association officials urged the administration and Congress to quickly resolve the spending dispute to avoid significant impacts on many infrastructure and public works projects. They also urged federal officials to address labor shortages by passing short-term relief measures like the Essential Workers for Economic Advancement Act and the Dignity Act and boost federal funding for construction education and training.
“With the Fed lowering interest rates, now is the time to address workforce shortages and provide tariff relief to boost demand for construction,” said Jeffrey D. Shoaf, the association’s chief executive officer. “In addition, avoiding the kind of prolonged federal shutdown that will undermine necessary approval processes that can slow down the delivery of necessary public works projects.”
View the metro employment data by state, by rank and top 10 changes changes.
AIA
Business conditions at architecture firms remained weak in September
The AIA/Deltek Architecture Billings Index (ABI) score of 43.3 for the month is the softest reading since April and represents an increase in the share of firms reporting a decrease from August. In addition, inquiries into new projects remained flat for the second consecutive month, following growth over the summer, and the value of newly signed design contracts decreased for the 19th consecutive month. All of these indicators mean that the soft conditions that many architecture firms have been experiencing since late 2022 are likely to persist for the foreseeable future.
Download ABI from September 2025
Firm backlogs soften
Recent revisions to work in the pipeline continue to erode as well. In the aftermath of the pandemic-induced downturn in 2020, architecture firm backlogs reached the highest levels we have seen since we started collecting that data regularly 15 years ago. Backlogs have gradually declined since the third quarter of 2022 and currently stand at an average of 6.1 months, down from 6.5 months at the beginning of the year. Backlogs are averaging just five months at firms with multifamily residential and commercial/industrial specializations, but stand at an average of eight months at firms with an institutional specialization. But despite the recent decrease in backlogs at firms, they still stand at levels nearly comparable to those before the pandemic.
Billings declined at firms in all regions of the country in September, except for firms located in the Midwest, where billings were essentially flat. Billings were softest at firms located in the West for the fourth consecutive month, where they have weakened the most over the last year. By firm specialization, business conditions were weakest at firms with an institutional specialization this month and continued to soften at firms with a commercial/industrial specialization, which reported conditions approaching growth over the summer.
Consumer confidence falls to lowest levels since spring
Due to the ongoing government shutdown, no updates to employment or inflation data for September are available. However, the Conference Board Consumer Confidence Index® sheds some light on business conditions in the broader economy in September. The index declined by 3.6 points to 94.2 in September (where 1985 equals 100), falling to its lowest level since April. Overall, the index remains well below pre-pandemic levels and significantly below the levels seen in 2021 and 2022. Concerns about current business conditions and job availability contributed to the decline this month, although optimism about future income increased. Additionally, overall confidence increased among consumers under 35, but decreased among those over 35. It seems likely that softer economic conditions will prevail in the aftermath of the government shutdown, but it may take a while before the data is released and we can assess the full impact.
An average of half of design billings are from reconstruction projects
This month, we asked firms about work on reconstruction projects to existing buildings (e.g., renovations, retrofits, rehabilitations, alterations, additions, and historic preservation) that their firms have performed over the last year. Overall, 97% of responding firms reported working on reconstruction projects over the past year. Firms located in the South (93%) and those specializing in multifamily residential development (93%) were least likely to report recent work on reconstruction projects. At firms that have worked on reconstruction projects in the last year, they estimated that an average of 50% of their firm’s total building design billings have been from these projects over the past year. This share was significantly higher at firms located in the Northeast (58%), where some of the oldest building stock in the country exists, than in the South (45%) and West (47%). Smaller firms also reported a much higher share of their billings from these projects, averaging 70% of total design billings at firms with annual billings of less than $250,000, compared to 40% at large firms with annual billings of $5 million or more.
Office buildings were by far the most commonly cited building type for which reconstruction projects were undertaken over the past year, cited by 53% of firms. Following office buildings were college/university education facilities (33% had reconstruction projects for this building type over the past year), government (30%), retail (28%), K-12 education (28%), multifamily residential (28%), and health care (27%).
The principal goals of reconstruction projects undertaken over the past year included basic updating and modernization of the building interior (cited by 74% of firms), upgrades to basic building systems (HVAC, lighting) (63%), upgrades to building shell (roof, facade, windows/doors, entrances) (63%), adaptive reuse or building conversion (61%), and tenant fit outs (54%). Basic updating and modernization was cited as the one single most important goal of recent reconstruction projects by 28% of responding firms, followed by adaptive reuse or building conversion (26%), and tenant fit-outs (16%). Tenant fit-outs were most commonly cited by firms with a commercial/industrial specialization (30% versus 15% of firms with a multifamily residential specialization and 8% of firms with an institutional specialization).
Finally, all firms were asked about their expectations for reconstruction projects in the future. Overall, two-thirds of responding firms (68%) expect that reconstruction projects as a share of total firm revenue will remain at about the same level over the coming years. More than one-quarter (28%) expect the share to increase, while just 4% expect it to decrease. Firms located in the South (34%) and large firms (35%) were significantly more likely to project that the share will increase in the coming years.
AWCI Releases 2025 Wall and Ceiling Industry Trends Report
With continued funding and support from the Foundation of the Wall and Ceiling Industry, the Association of the Wall and Ceiling Industry (AWCI) once again partnered with FMI to conduct a comprehensive survey and analysis of industry trends. The 2025 findings provide critical market insights enabling companies in the wall and ceiling industry to think strategically about the market and their businesses.
The 2025 survey measured AWCI member companies’ sentiment on the performance of the economy, the construction industry, and their businesses, while also exploring strategic priorities, business operations and top concerns among contractors, manufacturers and suppliers.
Key findings include:
- Economic Outlook and Growth Segments: Over 70% of members anticipate the economy and construction market to remain subdued or worsen. Data centers and health care are still expected to be the top growth drivers through 2026.
- Labor and Business Concerns: Talent availability is the most pressing challenge for contractors, with over 90% citing shortages in skilled crafts and field management. This concern is second only to the overall economic outlook.
- Demand and Strategy: Demand for wall and ceiling products is generally below 2024 forecasts for manufacturers and suppliers. Contractors are prioritizing increasing market share, while suppliers and manufacturers are focused on expanding their offerings.
