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Construction input prices decreased 0.9% in September compared to the previous month, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics’ Producer Price Index data. Nonresidential construction input prices also decreased 0.9% for the month.

Prices decreased in two of the three energy subcategories last month. Crude petroleum prices were down by 16.7%, while unprocessed energy materials prices were down 12.6%. Natural gas prices rose 2.4% in September. Overall construction input prices are 1.9% lower than a year ago, while nonresidential construction input prices are 2.1% lower.

“The decline in construction input costs observed in September was almost entirely due to a large decrease in oil prices,” said ABC Chief Economist Anirban Basu. “Certain materials, like gypsum, fabricated structural-metal products, asphalt and lumber exhibited sizable price increases for the month. While domestic freight rates are low by historical standards, elevated global container-shipping rates and emerging supply chain issues could put upward pressure on materials prices in the coming months. This represents a cause for concern for contractors, many of whom expect their profit margins to contract over the next six months, according to ABC’s Construction Confidence Index.”

Associated Builders and Contractors reported that its Construction Backlog Indicator increased to 8.6 months in September, according to an ABC member survey conducted Sept. 20 to Oct. 4. The reading is down 0.4 months from September 2023.

View the full Construction Backlog Indicator and Construction Confidence Index data series.

Backlog increased in every region except for the Northeast in September. On a year-over-year basis, however, only the Middle States have longer backlog than one year ago.

ABC’s Construction Confidence Index readings for sales, profit margins and staffing levels improved in September. The readings for all three components are above the threshold of 50, indicating expectations for growth over the next six months.

“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.”

Washington – Associated Builders and Contractors has released its fourth annual construction technology report, which focuses on the impacts of artificial intelligence in the construction industry. The report includes a case study and thought leadership from ABC’s Tech Alliance to showcase how ABC is working to strengthen members’ understanding of AI.

“ABC contractor members and the overall contracting community want more information on AI and how it can help them improve safety, quality and profitability, and win more work,” said Matt Abeles, ABC vice president of construction technology and innovation. “The ABC AI Tech Report highlights examples and insights from industry leaders invested in AI’s commitment to supporting the construction industry.”

“The interest in AI and machine learning is vast, which is why any contractor would find value in reading this report,” said Patrick Irwin, chair of ABC’s Construction Technology and Innovation Committee and chief operating officer at Leonard S. Fiore Inc. “For contractors and the construction industry in general, there is so much for us to learn relative to AI and ML so that we understand how to prepare, the possible uses and the overall implications. These tools can be used to move our businesses and the industry forward, and this report can give us all an opportunity to begin or continue our AI journey.”

The ABC AI Tech Report includes an AI Resource Guide that summarizes the basics of AI, a real-life case study from ABC contractor member Hensel Phelps and insights from Tech Alliance members and Dodge Construction Network.

The ABC AI Tech Report was published by the ABC National Construction Technology and Innovation Committee and was written for contractors by a cross-collaboration of partners, contractors and industry leaders. The report is made possible by ABC’s 2024-2025 Tech Alliance members: Arcoro, Autodesk Inc., BuildOps, Document Crunch, Egnyte, Field Control Analytics, Kojo, KPA, Procore, Sage, Smartapp, SmartBuild, SubHQ, Stack and Trimble.

Visit www.abc.org/Technology/Tech-Report to view the report.

The construction industry added 25,000 jobs on net in September, according to an Associated Builders and Contractors analysis of U.S. Bureau of Labor Statistics data. On a year-over-year basis, industry employment is up by 238,000 jobs, an increase of 3.0%. 

Nonresidential construction employment increased by 17,900 positions on net, with growth in 2 of the 3 subcategories. Nonresidential specialty trade added the most jobs, increasing by 17,000 positions. Heavy and civil engineering added 3,800 jobs while nonresidential building lost 2,900 positions.

The construction unemployment rate increased to 3.7% in September. Unemployment across all industries decreased from 4.2% in August to 4.1% last month.

“The construction industry added jobs for the fifth consecutive month despite labor shortages,” said ABC Chief Economist Anirban Basu. “The industry unemployment rate rose to 3.7% in September, but that’s still lower than in any month on record before the second half of 2018 and half a percentage point below the economywide unemployment rate. Hiring should persist in the coming months, with contractors expecting to increase their staffing levels over the next six months, according to ABC’s Construction Confidence Index.

“Beyond the construction industry, this jobs report blew past expectations,” said Basu. “U.S. employers added 254,000 jobs for the month, the most since March, and employment estimates for the previous two months were revised upward by a total of 72,000 jobs. While the ongoing strength of the labor market and consumer spending indicates that the economy has weathered high interest rates better than anyone thought possible, the combination of rising household debt levels and economic uncertainty surrounding geopolitics and the looming election will potentially weigh on growth in the coming months.”

By Joe Camilo, Tocco Building Systems

October is Careers in Construction Month, and rarely has it been more consequential.  According to our Chapter’s national parent organization, the construction industry needs to attract half-a-million new workers in the coming year to meet demand.  Addressing that need is a huge job, but we at ABC MA are trying to do our part.

As part of our workforce development efforts we have launched Building Mass Careers, a 501(c)3 charitable organization that is using grant funds to conduct pre-apprenticeship programs for diverse cohorts of individuals interested in construction.

Just last month, the Gould Construction Institute (GCI), ABC MA’s educational affiliate, opened its first-ever bricks and mortar facility in Billerica, MA.  Windover Construction worked with a number of fellow ABC-MA contactors to build out six classrooms at the facility with state-of-the-art shop and equipment space for hands-on practical education.  Watch for information on the formal ribbon cutting ceremony. 

As Gould President Julie DeStefano said, “Having our own facility gives us the flexibility to do things like offer year-round apprenticeship training and expand daytime training programs.”

While the new GCI facility is a symbol of a changing construction industry, some priorities remain the same.  None is more enduring than the responsibility we have to make sure all our employees return home safely to their families every evening.  To that end, the Chapter’s 2024 STEP (Safety Training Evaluation Process) Awards were given out late last month.  Congratulations to the 37 ABC MA companies who were honored for going above and beyond to ensure the safety of their employees.

Every day, we in the construction industry face formidable challenges.  I urge you to take a moment to look into the services ABC MA provides to make those challenges just a little more manageable.

National nonresidential construction spending increased 0.1% in August, according to an Associated Builders and Contractors analysis of U.S. Census Bureau data. On a seasonally adjusted annualized basis, nonresidential spending totaled $1.22 trillion.

Spending was up on a monthly basis in 10 of the 16 nonresidential subcategories. Private nonresidential spending decreased 0.1%, while public nonresidential construction spending was up 0.3% in August.

“Nonresidential construction spending inched higher in August, and that’s almost entirely due to ongoing infrastructure investments,” said ABC Chief Economist Anirban Basu. “Public spending accounted for all of the nonresidential segment’s monthly increase and has risen nearly 8% over the past year, significantly outpacing privately financed nonresidential construction activity. As a result of ongoing weakness in certain private subsegments, ABC’s Construction Backlog Indicator has fallen by a full month over the past year. While falling interest rates will eventually serve as a tailwind for the industry, it may be several quarters before privately financed segments see any substantial relief.”

The construction industry had 370,000 job openings on the last day of August, according to an Associated Builders and Contractors analysis of data from the U.S. Bureau of Labor Statistics’ Job Openings and Labor Turnover Survey. JOLTS defines a job opening as any unfilled position for which an employer is actively recruiting.

Industry job openings increased by 138,000 last month but are down by 16,000 from the same time last year.

“Construction job openings rebounded sharply in August, exhibiting the largest one-month increase on record,” said ABC Chief Economist Anirban Basu. “Much of this surge is likely due to the effects of Hurricane Beryl on July’s job openings data. Despite this bounceback, industrywide job openings are still down 19% since hitting a cyclical peak in February, a reflection of moderating activity in the face of high interest rates and economic uncertainty. Even so, labor still remains scarce, especially for certain occupations, and many contractors still intend to increase their staffing levels over the next six months, according to ABC’s Construction Confidence Index.”

On Sept. 6, President Joe Biden signed Executive Order 14126 on Investing in America and Investing in American Workers, a new effort by the Biden administration to utilize federal policy to favor unions that is likely to undermine competition to build taxpayer-funded infrastructure projects.

In response to the White House EO fact sheet released Friday morning prior to Biden signing the EO at a union hall in Michigan, ABC immediately issued a press release condemning the EO and its impact on fair and open competition that was picked up in multiple media outlets, stating in part:

“This gift to unions is discouraging for the overwhelming majority of the U.S. construction industry workforce—nearly 90%—that works for nonunion employers,” said Ben Brubeck, ABC vice president of regulatory, labor and state affairs. “It also will hurt taxpayers and the overall construction industry, as both benefit from inclusive, win-win policies that welcome all contractors and workers to rebuild America, even if they decide not to affiliate with labor unions.

“The executive order will undermine the efficient and economical delivery of taxpayer-funded infrastructure, clean energy and manufacturing projects and is consistent with the Biden-Harris administration’s politically motivated policy schemes,” said Brubeck. “These policies steer taxpayer-funded infrastructure contracts to unionized businesses and create jobs exclusively for union members at the expense of everyone else and the rule of law.”

The EO, which claims to be an effort to promote high-quality jobs on federally funded construction projects, steers contracts to unionized firms and creates unions jobs by directing agencies to prioritize the distribution of federal financial assistance to applicants that (among other provisions listed in Section 3 of the EO):

• Utilize project labor agreements or other union agreements.
• Require union neutrality agreements and deprive workers of secret ballot elections when choosing union representation of its workplace, which will increase the growth of union membership.
• Pay wages based on inaccurate, government-determined prevailing wages or union wage scales.
• Focus workforce development efforts on union-affiliated training programs and government-registered apprenticeships.

The EO directs agencies to implement this prioritization through application evaluation criteria on notices of funding opportunity. Already, ABC has identified over $271 billion in federal funding since President Biden took office subject to language and policies promoting PLA mandates and preferences that will increase costs and reduce competition on federally assisted construction projects.

The EO establishes a new Investing in Good Jobs Task Force within the Executive Office of the President, co-chaired by the secretary of labor and the director of the National Economic Council, with the responsibility of ensuring the EO is implemented across the federal government.

It is unclear when the Task Force recommendations will be released for public review, whether there will be a public notice and comment period for any new regulations or if this will be done administratively with no public input.

Of note, it is unclear if this new policy is something that a Harris or Trump White House would support, eliminate or modify.

it is more likely that a Trump White House would eliminate additional red tape undermining taxpayer investments in infrastructure, as the Trump administration previously repealed an Obama administration rule imposing a controversial pro-labor blacklisting regulation  on federal construction projects that is similar in nature to the Good Jobs EO.

On Sept. 10, Brubeck joined Labor Relations Radio to discuss the new EO in greater detail.

ABC will continue to oppose and monitor this issue and forthcoming Task Force recommendations, policies and rulemakings.

Associated Builders and Contractors has reported that its Construction Backlog Indicator fell to 8.2 months in August, according to an ABC member survey conducted Aug. 20 to Sept. 5. The reading is down 1.0 months from August 2023.

View the full Construction Backlog Indicator and Construction Confidence Index data series.

Only the infrastructure category experienced a monthly increase in backlog among the three major segments, reflecting strength in public construction spending. Nonetheless, over the past year, backlog has declined in all three segments.

ABC’s Construction Confidence Index readings for sales, profit margins and staffing levels fell in August. The readings for sales and staffing levels remain above the threshold of 50, indicating expectations for growth over the next six months, while the reading for profit margin expectations fell below that threshold.

“As predicted, confidence among contractors is slipping,” said ABC Chief Economist Anirban Basu. “While ABC contractor members are still anticipating expanding sales and employment, profits margins are increasingly under pressure as project owners face high borrowing and construction delivery costs in the context of a slowing economy. Many projects have been postponed, resulting in recent backlog declines, most notably in the South.”

The construction industry had 248,000 job openings on the last day of July, according to an Associated Builders and Contractors analysis of data from the U.S. Bureau of Labor Statistics’ Job Openings and Labor Turnover Survey. JOLTS defines a job opening as any unfilled position for which an employer is actively recruiting. Industry job openings decreased by 51,000 last month and are down by 103,000 from the same time last year.

“Construction job openings plunged for the second straight month in July,” said ABC Chief Economist Anirban Basu. “Much of this decline is likely due to the residential sector. More housing units were completed in June than in any month dating back to 2007, and the number of housing units under construction has fallen about 8% since the start of the year.

“That’s not to suggest that the nonresidential segment has not also seen a decline in its demand for labor,” said Basu. “The share of construction jobs that are currently unfilled has fallen to the lowest level since early 2018, and a portion of that contraction is due to weakness in certain segments like commercial and lodging. Despite the dearth of openings, contractors continue to lay off workers at a historically slow pace, and fewer than 1 in 7 contractors expect their staffing levels to decline over the next six months, according to ABC’s Construction Confidence Index.”