Michael Latas & Associates
Construction Report - March 2026
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Executive Summary
The latest available labor snapshot showed construction lost 11,000 jobs in February, according to BLS data released March 6. BLS said employment in construction showed little change in the broader payroll release, and ABC noted the industry’s unemployment rate was 6.9% in February. In other words, after January’s rebound, February gave some of it back. Hiring demand also eased from the prior month. ABC reported on March 13 that the industry had roughly 231,000 construction job openings at the end of January. That was down materially from the 292,000 openings reported one month earlier for December, suggesting that while demand for labor remains real, it is not broad-based enough to support a straight-line hiring surge. Backlog improved slightly in the newest reading. ABC reported on March 10 that its Construction Backlog Indicator rose to 8.1 months in February, up from 8.0 months in January. So the most recent picture is not one of collapse; it is more a story of stable-to-slightly-improving backlog alongside a still uneven labor market. March also brought several important large-company announcements that reinforced where demand is strongest. Fluor announced a limited notice to proceed with TeraWulf on a large-scale Kentucky data center project, highlighting continued investment in power-intensive digital infrastructure. KBR announced a new project management contract tied to Libya’s South Refinery project and another long-term maintenance contract for SATORP’s petrochemical expansion complex, signaling ongoing strength in energy and industrial project delivery. And Balfour Beatty said it expects 2026 profit growth on the back of a record order book weighted toward power projects, including nuclear, with its U.S. building business helping offset cost pressure elsewhere. A notable parallel trend is data-center concentration. ConstructConnect said January 2026 data center starts reached $25.2 billion, with significant activity across the Midwest and East Coast, which helps explain why backlog is holding up best for larger firms and why electrical/mechanical contractors remain relatively well positioned. What it means: March looks like a selective-growth market. The labor picture cooled, but backlog did not deteriorate meaningfully. That combination usually points to a market where owners are still funding major projects, but hiring is being managed carefully and smaller or less-specialized contractors may feel more strain than firms tied to data centers, power, infrastructure, and industrial work.
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