Data center projects extend construction backlogs

Article originally posted on CoStar on September 15, 2026

More U.S. construction companies are landing contracts to build data centers, expanding backlogs across the industry even as activity slows in other construction work.

A survey released Tuesday from the Associated Builders and Contractors noted that one in six of the trade group’s members is under contract to build a data center. It’s the highest proportion the group has ever recorded. Members reported having an eight-and-a-half-month backlog in August, up from only eight months in July, the survey found.

“Data centers continue to keep contractors busy even as activity softens in other segments,” ABC Chief Economist Anirban Basu said in a statement. “Although the backlog gap between contractors with and without data center work narrowed in August — 9.9 versus 8.3 months respectively — that appears to reflect more contractors securing work in the data center segment rather than a broader structural trend.”

A backlog is the amount of work, measured in dollars, that construction companies are contracted to perform but haven’t yet completed. In the construction world, backlogs often decline when the economy weakens because companies continue to do their current work, but the number of new contracts shrinks.

Construction companies are showing a mixed bag in terms of hiring or keeping their staff over the next six months, the survey found. The survey, conducted between Aug. 20 and Sept. 4, noted that the number of companies planning to lay off workers in the next six months rose to 12.3% in August, compared to 8.7% in July.

“At the same time, there was a sharp increase in the number of contractors who, unprompted, mentioned labor shortages in the survey,” Basu said. “With construction job openings at a near two-year high, it appears that labor scarcity is reemerging as a major headwind for the industry.”