Construction Backlog Indicator of ABC remains unchanged in October

Construction Backlog Indicator of ABC remains unchanged in October

Associated Builders and Contractors (ABC) released the details of its Construction Backlog Indicator. They made the announcement that their Construction Backlog Indicator remained unchanged in October. The indicator virtually unchanged at 8.2 months as only +0.2% change occurred as compared to September’s reading.

Anirban Basu, the chief economist of ABC, said, “Many would consider a flat reading on the backlog as a nonevent, yet nothing could be further from the truth.” The market is facing a lot of uncertainties including the weakening world economy, the political instability from Washington, trade war, and volatility of financial markets. Basu made a point, “The fact that backlog did not decline is significant in terms of the current market conditions.”

It is a tough task for the decision-makers as there are so many uncertainties all around. The commercial construction categories indicated weakness. The rise of the short-term interest rate by the federal government nine times from December 2015 to December 2018 is one of the reasons behind the weakness. The cost of capital has been raised due to the rise in the interest rate.

It is hard for commercial projects to move forward under this condition. In 2019, the Federal Reserve lowered the interest rate three times. The backlog expanded in October and the lower cost of capital was the main reason behind this expansion. Basu said that the decline of the backlog in the heavy industry was due to trade disputes.

Basu added that infrastructure backlog also declined during October and it usually tended to vary month to month. He said that the infrastructure backlog would smooth in the upcoming time as the US economy had the lengthiest expansion in history. This expansion of the economy will help the infrastructure backlog to rise. Overall, the Construction Backlog Indicator remained unchanged in October as compared to September.

Managing editor of the Chicago Morning Star

Related Posts
Critics Link 5,200 Job Losses to Chicago Wage Law
More than 5,200 jobs have been lost and over 100 restaurants have closed in Chicago
Charter Schools See Federal Funding Boost Amid Rising Enrollment
The Department of Education recently approved a $60 million increase for charter schools, raising their
Chicago Fire Clinch 3–2 Win Over Charlotte FC at Home
Chicago Fire FC edged out Charlotte FC with a 3–2 victory on Saturday at Soldier
Universal Horror Unleashed to Open in Chicago by 2027
Universal Destinations & Experiences, a division of Comcast NBCUniversal, has unveiled plans to open a
Chicago Cuts Divvy Membership Costs, Expands Access
Mayor Brandon Johnson, the Chicago Department of Transportation (CDOT), and Lyft have announced a set
Chicago Shooting Leaves 4 Dead, 18 Wounded at Event
What began as a lively evening in a bustling Chicago neighborhood known for its restaurants
Chicago Sky Partners With Moonshot to Tackle Online Abuse
The Chicago Sky has entered a groundbreaking partnership with Moonshot, a company specializing in countering
Chicago Fire FC II Earns MLS NEXT Pro Honors Again
Chicago Fire FC II has been named the MLS NEXT Pro Team of Matchweek 16,
Chicago Lawn Sees $5.1M Street Reconstruction Begin
A major infrastructure improvement has begun in the Chicago Lawn neighborhood, where the Chicago Department
Zinckernagel Earns Spot in MLS Team of the Matchday
Chicago Fire FC winger Philip Zinckernagel has been named to the MLS Team of the
Critics Link 5,200 Job Losses to Chicago Wage Law
More than 5,200 jobs have been lost and over 100 restaurants have closed in Chicago
Charter Schools See Federal Funding Boost Amid Rising Enrollment
The Department of Education recently approved a $60 million increase for charter schools, raising their
Chicago Fire Clinch 3–2 Win Over Charlotte FC at Home
Chicago Fire FC edged out Charlotte FC with a 3–2 victory on Saturday at Soldier
Universal Horror Unleashed to Open in Chicago by 2027
Universal Destinations & Experiences, a division of Comcast NBCUniversal, has unveiled plans to open a
Chicago Cuts Divvy Membership Costs, Expands Access
Mayor Brandon Johnson, the Chicago Department of Transportation (CDOT), and Lyft have announced a set
Chicago Shooting Leaves 4 Dead, 18 Wounded at Event
What began as a lively evening in a bustling Chicago neighborhood known for its restaurants
Chicago Sky Partners With Moonshot to Tackle Online Abuse
The Chicago Sky has entered a groundbreaking partnership with Moonshot, a company specializing in countering
Chicago Fire FC II Earns MLS NEXT Pro Honors Again
Chicago Fire FC II has been named the MLS NEXT Pro Team of Matchweek 16,