Construction industry leaders’ confidence declined in April after increasing in March, according to www.abc.org.
Two of the three components decreased in April, but all three remained above the diffusion index threshold of 50.
In April, the Associated Builders and Contractors’ Construction Confidence Index decreased from 65.8 to 63.9 for sales expectations and 53.7 to 53.4 for profit margin expectations. The index increased from 63.7 to 64 for staffing levels.
Additionally, ABC’s Construction Backlog Indicator rose to 7.9 months in April.
“There was little movement in contractor sentiment in April,” said ABC Chief Economist Anirban Basu. “Collectively, contractors continue to indicate that industry recovery will continue into the summer and beyond. The broader economy is poised to recover rapidly into 2022 as a potent combination of accumulated savings, stimulus, vaccinations and reopening drive consumer outlays and business spending higher. Available data indicate that while many segments, including the office market, continue to exhibit weak fundamentals, the worst is now past in terms of market deterioration.
“There are risks to the outlook, including inflation, rising interest rates and viral variants that may prove more resistant to available vaccines and treatments,” Basu continued. “Labor and materials shortages may also continue to challenge the industry. Indeed, materials prices have been racing higher recently. A recovering global economy and overwhelmed supply chains may further increase commodity prices during the months ahead, potentially suppressing contractor profit margins.”
