Good news broke ground for contractors in July as construction stress eased across the board.
The rate of construction freezes and cancellations plummeted in July, according to the latest data from Cincinnati-based ConstructConnect. The Project Stress Index, a measure of construction projects that have been paused, abandoned or delayed, fell 24.3% between June and July.
That decline offered some relief for builders facing rising material costs and elevated borrowing rates. A 37.1% drop in abandonments in July drove the overall decline in project stress. On-hold and bid delays fell too, by 15.5% and 4%, respectively, according to the data.
Stress in the private sector eased most significantly in July. Private bid delays fell close to historic lows and on-hold activity dropped to around its long-term average, said Devin Bell, associate economist at ConstructConnect.
But both private and public sector abandonment activity remain near historic highs.
Even with the improvement in stress in July, the index sits 14.1% above the 2021 baseline, said Bell. Over the past year, overall stress is up 25.9%, he said.
“We typically see abandonment activity trail off after the first half of the year,” said Bell. “July has broken this trend with both sector abandonments near historic highs as we enter the second half of the year.”
In the public sector, abandonments remain near the index peak, up 76.7% year over year, despite the decline in July. At the same time, projects placed on hold in the public sector ticked up 2.1% compared to the same period in 2024, according to the data.
Pittsfield, Massachusetts-based Unistress Corp. and its subsidiary, Berkshire Concrete Corp. laid off 233 workers, according to a Massachusetts Worker Adjustment Retraining Notification notice filed for the week ending June 27. Unistress CEO Perri Petricca said the decision stems from the delay of two major contracts following volatility in steel prices.
Irving, Texas-based Fluor also recently reported delays and cancellations on its backlog due to cost escalation, trade policy shifts and interest rates, according to its second quarter earnings call. Its CEO Jim Breuer told investors the construction market has entered a period of “short-term hesitation.”
“The volatile economic environment continues to weigh on the construction market,” said Bell. “[That’s] potentially pushing some owners and developers toward abandonment.”
