Contractors with data center work hold 11.3 months of backlog, three more than the rest

Contractors had 8.7 months of work lined up in September, up from 8.5 a year earlier, according to Associated Builders and Contractors ^[1]. ABC chief economist Anirban Basu said “data center work continues to keep contractors busy” ^[1].

About 15% of ABC members have data center contracts ^[1]. Among contractors with more than $100 million in revenue, 39% do, compared with about one in 10 smaller firms ^[1].

Contractors are absorbing most of an 11.9% rise in input costs

More than one in four contractors expect profit margins to shrink over the next six months, the highest share since November 2025 ^[1]. AGC says most contractors are absorbing cost increases because demand outside data centers is soft ^[2].

Nonresidential trades are hiring while residential trades shrink

Construction added 11,000 jobs in September and 109,000 over the year, and its unemployment rate fell to 3.5% ^[3]. Production workers earned $39.20 an hour on average, up 4.3%, and nonresidential firms added 142,000 jobs over the year, a 2.9% gain ^[3].

Half of the 360 metros AGC tracks added construction jobs over the year, and 118 lost them ^[4]. The pool of unemployed jobseekers with construction experience shrank 11% to 359,000 ^[3].

How to use this

For trade contractors

1. Add a fuel and materials escalation clause to every bid that runs past 90 days. Diesel rose 115.2% and copper 30.0% in a year ^[2], and a fixed-price bid written last fall would not cover either.
2. Ask general contractors for a deposit on long-lead steel. AGC reports steel beam makers have order books full through spring 2027 ^[2], so put the delivery date and who carries the delay cost in writing.
3. Consider a move toward nonresidential work if you are a residential sub. Residential builders and trades shed 32,800 jobs over the year while nonresidential specialty trades added 84,700 ^[3].

For developers and landlords hiring contractors

1. Get two bids and compare backlog, not just price. The average contractor has 8.7 months of work booked and data center firms 11.3 ^[1], so ask each bidder when its crew can start and get the date in the contract.
2. Ask bidders for crew counts in Atlanta, not just schedules. Metro Atlanta’s construction employment fell 5,100 to 104,700 in a year ^[4], yet Georgia’s construction unemployment rate was only 2.1% ^[5], which suggests workers left the local industry rather than waiting for work. Phoenix went the other way, adding 5,900 construction jobs to reach 183,900 ^[4].

For investors

1. Budget hard costs at current prices, not last year’s. ABC put September input prices up 11.2% from a year earlier for both total and nonresidential construction ^[6], so on $1 million of materials priced a year ago, we calculate about $112,000 of added cost today.