Associated Builders and Contractors’ (ABC) Construction Backlog Indicator (CBI) declined 3.2 percent during the first quarter of 2015. The dip is the result of “weather and a myriad of other factors” that always affect the first quarter,” according to ABC chief economist Anirban Basu.
Construction firms report a revenue-weighted average CBI of 8.4 months, 0.3 months below the fourth quarter of 2014 reading. Year-over-year, CBI has increased 4 percent from the first quarter of 2014 backlog of 8.1 months.
“A brutal winter may have postponed project-related work, including the signing of contracts. The first quarters of 2012 and 2014 also experienced CBI declines that effectively were reversed during the ensuing second quarters,” says Basu. “However, there is a reason to believe seasonal forces were not the only factors in reducing CBI.
“Sharp reductions in oilfield investment impacted a number of companies in the Middle States, while firms in the West appear to have been disproportionately impacted by the West Coast port slowdown. Weather and the port slowdown represent temporary factors, implying that backlog should re-establish an upward trajectory during the months to come.”