Construction industry leaders were more confident in September, according to Associated Builders and Contractors.
All three components of ABC’s Construction Confidence Index increased for the month, and all were above the diffusion index threshold of 50.
In September, ABC’s Construction Confidence Index increased from 49.1 to 50.9 for profit margin expectations; from 53.8 to 58.1 for sales expectations; and from 56.4 to 58.2 for staffing levels.
Additionally, ABC’s Construction Backlog Indicator rose from 8.2 months in August to 8.6 months in September, which is down 0.4 months from September 2023.
“Contractor confidence rebounded in September," said ABC Chief Economist Anirban Basu. “While the reading for profit margins briefly dipped below the threshold of 50 in August, indicating net expectations of contraction, contractors are back to expecting modest expansion in their margins as of September. This optimism likely reflects falling interest rates, which will eventually serve as a tailwind for the industry, and the fact that materials prices have actually declined over the past year. Despite the improved outlook in September, contractor confidence is worse and backlog shorter than one year ago, suggesting that the effects of high interest rates continue to weigh on the industry.”
