The Construction Economist — August 15, 2026

Backlog round-trips the whole 2026 run-up · The 8.0 average hides a 3.9-month split · July inflation eases for a second month · ERCOT sets a peak-demand record as generation lags · Jobs growth keeps outrunning volume

Top News

ABC's Construction Backlog Indicator Plummets in July Associated Builders and Contractors · ~3 min read

Associated Builders and Contractors (ABC) reported that its Construction Backlog Indicator fell to 8.0 months in July, down 0.8 months from both June and July 2025, based on a member survey conducted July 20 to Aug. 4. Every industry, region and company size recorded a decline, and the South was the only region carrying more backlog than a year ago. ABC chief economist Anirban Basu said the 88% of member contractors with no data center work under contract averaged 7.5 months of backlog against 11.4 months for the 12% that do, and that backlog in the $30-$50 million annual revenue category fell to its lowest level since March 2020.

What it means: Backlog is the industry's forward order book, so a drop this broad — every industry, every region, every company size — is a bookings problem rather than a billings one. The 8.0 headline is also an average pooling two markets that no longer behave alike: strip out the 12% of contractors with data center work at 11.4 months and the typical firm is sitting at 7.5, with the $30-$50 million revenue band back at March 2020 levels. Assume more bidders per job through the fourth quarter, and watch whether the confidence index's sales reading — still above 50, but falling — turns down to meet backlog.

Inflation Eased Slightly in July NAHB Eye on Housing · ~3 min read

Consumer price inflation eased in July for the second consecutive month, after reaching a three-year high in May, led by declines in gasoline and diesel prices. With energy prices moderating, shelter resumed its role as the largest driver of headline inflation — accounting for one-third of the annual increase and more than two-thirds of the monthly increase, according to the National Association of Home Builders' analysis.

Project Finance & Economics

Construction Briefs, August 2026: Jobs Growth Keeps Running Ahead of Volume Construction Analytics — Ed Zarenski · ~5 min read

Construction jobs growth has outpaced growth in business volume for more than two years, according to Ed Zarenski's August briefs. When headcount rises faster than the volume of work put in place, productivity declines and the added labor cost shows up in building cost inflation rather than output.

Texas Hits New Peak Demand Record, but Supply Constraints Will Limit Growth Utility Dive · ~3 min read

ERCOT set a new peak demand record as data center and industrial load continued to climb. A report from Ascend Analytics finds that more than 80% of new large loads seeking interconnection in Texas will not have matching generation online by 2030.

Labor & Workforce

"Historic" Labor Market Shrinkage Highlights Need for AI: Economist Construction Dive · ~4 min read

RSM economist Joe Brusuelas characterized the current contraction in the U.S. labor force as historic, driven in part by a pullback from employment among workers aged 65 and older. He argues that shrinking labor supply may partly allay concerns that demand for artificial intelligence will fall short of the coming surge in AI capacity.

IRS Issues Updated Guidance on Overtime Tax Deduction AGC News · ~3 min read

The Internal Revenue Service released updated FAQs on the new deduction for qualified overtime compensation. The guidance clarifies eligibility, reporting and withholding requirements for employers, according to the Associated General Contractors of America.

Policy, Codes & Regulation

FTA Grants $1.28B for Utah Commuter Rail Smart Cities Dive · ~3 min read

The Federal Transit Administration awarded $1.28 billion toward Utah's 83-mile FrontRunner commuter rail line connecting Ogden, Salt Lake City and Provo. The funding would pay for additional trains and track, though open questions about federal funding could still affect the project's timeline.

U.S. Circuit Court Says Mental Illness Is Not a Recordable Injury ARTBA · ~2 min read

A federal appeals court ruled on July 21 that mental illness is not a recordable injury under the Occupational Safety and Health Administration's injury and illness recordkeeping rule. The American Road & Transportation Builders Association flagged the decision for contractors maintaining OSHA 300 logs.

The Construction Economist — What's Moving Construction? The Economic Look-Ahead.