Associated Builders and Contractors reported the construction backlog indicator rebounded to 8.1 months in February 2026, sparking optimistic headlines about a construction recovery. The backlog reflects the total value of ongoing and upcoming construction projects under contract but not yet completed, indicating future workload and revenue potential for a company. But if you’re running a commercial construction firm in the Carolinas and treating that number as a green light, you may be making decisions based on data that doesn’t reflect your reality.
This guide is designed for commercial construction executives, project managers, and business owners in the Carolinas seeking to make informed decisions based on the latest backlog data.
Construction backlog refers to the total value of work under contract that has not yet been completed. The backlog reflects the total value or amount of ongoing and upcoming projects in a construction company, indicating future workload and revenue potential. It also reflects the company’s ability to manage both current and future workload. ABC’s construction backlog indicator converts that dollar amount into “months of work” by dividing backlog by annual revenues and normalizing across surveyed firms. This methodology allows for comparisons across firms of varying sizes.
ABC Chief Economist Anirban Basu publishes regular CBI analysis through Associated Builders and Contractors and Construction Executive. His commentary is widely used by owners, lenders, and contractors as an early demand barometer—signaling expected activity two to three quarters ahead rather than retrospective performance.
ABC’s CBI Formula: Backlog Dollars ÷ Trailing 12-Month Revenue × 12 = Months of Backlog
For Carolina’s commercial contractors, this matters because executives use backlog months to time hiring, equipment purchases, and decisions about which sectors to pursue. Backlog size and complexity influence a company’s ability to fulfill customer orders, meet deadlines, and maintain financial stability. A healthy backlog gives visibility into future projects and supports informed decisions about resource allocation.
CBI dipped to January’s four year low before rebounding to 8.1 months in February, restoring backlog to roughly mid-2025 levels—a level that matches or exceeds backlog levels seen last summer. Headlines announced a “construction recovery,” and contractor confidence ticked up.
But many firms in the Carolinas are reading this figure as universal—assuming everyone is busy again. The reality is more nuanced:
| Firm Size (Revenue) | Typical Backlog | Primary Work Type |
|---|---|---|
| Over $100M | 9–11 months | Mega-projects, multi-year EPC |
| $30M–$100M | ~8.1 months | Mixed commercial/industrial |
| Under $50M | 5–7 months | Tenant improvement, light commercial |
| The February rebound reflects a sizable backlog from large manufacturing, data center, and infrastructure projects—not a broad-based surge in traditional commercial building. For Carolinas executives, the question isn’t whether 8.1 is high or low. It’s: where does your company sit relative to that figure by revenue size and sector, and how does your construction backlog relate to your current projects and future workload? | ||
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ABC’s data reveals a widening size gradient since 2024. National contractors over $100M are capturing multi-year industrial and data center work, while smaller contractors focus on shorter-cycle projects lasting 6–12 months, making apprenticeship and craft education programs critical for building a flexible, skilled workforce.
What this means for Carolinas firms:
Example scenario: A $40M commercial GC sees the 8.1-month headline, assumes they’re behind, and aggressively hires 15 craft workers. Their actual backlog is 5.5 months of shorter-duration tenant improvements. When two anticipated contract awards slip to Q4, they’re carrying excess payroll through a soft summer—a dangerous trap that erodes margins.
The balanced approach: benchmark against peers of similar size, not the national aggregate. A healthy construction backlog for smaller contractors may look very different from that reported by larger firms.
ABC’s Southeast CBI has consistently run 0.4–0.9 months above the national average since the post-pandemic industrial boom. In early 2026, the regional backlog is likely to sit at 8.5–9.0 months.
Key Carolinas corridors showing strength:
However, regional strength doesn’t mean uniform opportunity. Smaller markets relying on K-12 public work or volatile retail/hospitality may see 4–6 months backlog. Strong growth in hot corridors also attracts national players, intensifying competition for subs and materials. Attending construction safety, networking, and educational events can help Carolinas contractors deepen relationships with subs and stay ahead of regional trends.
Benchmark your backlog against both national CBI (8.1) and Southeast figures (~8.5–9.0), then adjust for your sector exposure. Securing new projects is essential to maintaining a healthy workload, avoiding gaps in your construction backlog, and ensuring long-term stability.
The February rebound wasn’t uniform across sectors. Your firm’s true 2026 outlook depends more on sector mix than the headline figure.
Commercial Building Retail, hospitality, and conventional office remain uneven. Backlog is often shorter (5–7 months) and sensitive to interest rates and borrowing costs. Charlotte office conversions yield spotty 6-month pipelines. Firms heavily exposed to private commercial face higher bid volumes to maintain a steady stream of work.
Industrial and Manufacturing Multi-billion-dollar data centers and manufacturing plants generate multi-year backlog for large teams. Mid-sized Carolinas contractors can participate in site work, utilities, interiors, and specialty packages—often with 18–24-month durations. Greenville, SC, logistics hubs are showing 12-month backlogs.
Infrastructure IIJA-funded transportation and water projects support robust public backlogs (12–30 months for heavy-highway). Civil and utility contractors in both Carolinas benefit from this steady flow of funded work.
With the increasing complexity of construction projects, project management software plays a crucial role in managing resources and schedules across sectors. Events at ABC’s Metcon Office in Charlotte often showcase tools and best practices that support these efforts.
A construction business 70% exposed to private commercial faces a very different risk profile than one 70% public or industrial.
Backlog data tells one story. February’s 1.3% month-over-month jump in construction input prices tells us another story.
Current pressures on Carolinas contractors:
| Indicator | February 2026 Reading | Implication |
|---|---|---|
| CBI | 8.1 months | Revenue visibility improves |
| Input Prices | +1.3% MoM | Margin compression on fixed-price work |
| BLS JOLTS Hiring | ~+20k vs. +50k expected | Staffing struggles despite backlog |
| Job Openings | Elevated (~400k-500k) | Competition for craft labor intensifies |
| Steel, concrete, electrical gear, and mechanical components remain volatile due to supply chain management challenges, energy costs, and looming tariffs. Oil prices and global trade policy add uncertainty. | ||
| ABC’s confidence indices show contractors optimistic about sales but cautious about profit margins. Basu’s commentary emphasizes this squeeze: firm backlog plus rising inputs plus wage pressures equals shrinking 2026 margins without aggressive escalation, contingencies, and productivity management—topics that feature heavily in ABC Carolinas safety and economic summits. |
For Carolinas executives, the implication is clear: longer backlog at fixed prices plus rising typical costs equals potential project delays in profitability unless you act now.
Most economists, including ABC’s Basu, expect slowing U.S. growth (1.5–2% GDP), sticky inflation (3–4%), and tariffs to keep construction costs elevated through late 2026.
Key 2026 Headwinds:
Key 2026 Tailwinds:
The Carolinas are positioned to outperform national averages. But this is a “selective growth” year—focus on best-fit sectors and delivery models (design-build, CM at-risk) rather than chasing volume. Firms that manage expectations about margin versus revenue will achieve long-term success.
ABC Carolinas recommends using CBI and related indicators as decision tools. Here’s how to act on current signals:
Action 1: Recalibrate Your Backlog Benchmark. Calculate your backlog in months using ABC’s formula (backlog dollars ÷ trailing 12-month revenue × 12). Compare against national CBI (8.1) and Southeast CBI (~8.5–9.0), segmented by your firm size and sector. Identify whether you’re over- or under-exposed heading into late 2026. Use financial reports and your WIP report to validate.
Action 2: Align Hiring with Real Demand. If running 5–7 months, focus on targeted hiring and retention bonuses for key craft professionals. Enroll in ABC Carolinas apprenticeship and safety training programs. Avoid panic hiring that assumes uniform boom conditions. Track staffing expectations against contracted backlog, not pipeline hopes.
Action 3: Lock In Critical Costs and Partners Work with preferred suppliers to secure pricing windows on long-lead items. Use preconstruction services to share escalation risk with owners. Establish supplier agreements using project management software to track commitments. This protects your company’s ability to deliver quality projects profitably.
Backlog, input prices, and labor data are most valuable when tracked monthly—not as isolated headlines.
Build your internal dashboard:
ABC Carolinas resources:
The ABC Carolinas chapter curates economic data, safety initiatives, and professional development programs that translate national trends into practical strategies for Carolinas contractors.
Designate a senior leader—CFO, preconstruction director, or VP of operations—as your “economic intelligence owner” who digests ABC and BLS releases and translates them into firm-specific recommendations for new business pursuits.
ABC Carolinas serves commercial and industrial contractors across North and South Carolina through:
Our merit shop philosophy supports members in pursuing current and future projects profitably and ethically—even when backlog pressures tempt them to bid aggressively. Members access Construction Executive analysis, ABC National economic releases, and local briefings that translate CBI data into actionable Carolinas insights.
Connect with ABC Carolinas to: Use the chapter’s contact channels to reach staff who can guide you to the most relevant programs and events.
Recalculate backlog monthly, aligning with internal WIP and cost-to-complete reviews. In rapidly changing environments, bi-weekly tracking helps project managers and executives stay ahead. The CFO or controller should partner with preconstruction and operations leaders to ensure both financial and field realities are reflected. Consistency matters more than precision—trend direction is what drives decisions.
Anchor hiring to contracted backlog and high-probability awards, not optimistic pipeline projections. In 2026’s uncertain economic conditions, only staff ahead of contract when the win likelihood and funding are very high. Use ABC Carolinas apprenticeship programs to build a flexible talent bench, supplementing permanent hires with strategic subcontracting rather than overbuilding fixed payroll. The March jobs report will provide additional context for regional trends.
Include escalation clauses, allowances, and shared-savings mechanisms in contracts. Early procurement of long-lead materials—coupled with supplier agreements that lock pricing—reduces exposure. Use disciplined change order management and regular re-forecasting to catch margin erosion early. Avoid the lengthy dispute that can arise from poorly documented scope changes.
A firm’s “right” backlog depends on size, sector mix, and risk tolerance. Running below 8.1 months doesn’t automatically signal trouble—measure backlog against peers of similar size and specialty. ABC Carolinas networking and roundtables can facilitate this comparison, and the membership application process makes it straightforward for qualified firms to get involved. If backlog is genuinely short, shift business development toward sectors with stronger 2026 demand: public infrastructure, light industrial, and healthcare. Maintain the steady flow of bidding activity without accepting work that aligns neatly with desperation rather than strategy.
Designate one senior leader to spend 1–2 hours monthly reviewing ABC National releases, Construction Executive summaries, and BLS JOLTS data. Create a one-page monthly brief summarizing CBI trends, input price movements, and labor indicators with 1–2 firm-specific implications. ABC Carolinas distills this through newsletters, webinars, and chapter meetings—helping smaller firms act on the same intelligence as larger competitors without dedicated research staff.
