Key Takeaways
- Backlog rebounds to 8.1 months in February, up 0.1 from January’s four-year low, but the headline number masks a growing divide between contractors with data center work and everyone else.
- Data center contractors hold 11.2 months of backlog compared to just 7.6 months for non-data-center firms, a 47% gap that signals a structural shift in who gets to grow and who gets squeezed.
- BlackRock commits $100M over five years to train 50,000 skilled trades workers through its Future Builders initiative, targeting electricians, plumbers, and HVAC technicians.
- Six contech startups raised $126M combined in recent weeks, with funding concentrated in AI safety monitoring, jobsite capture, equipment rental software, and construction payments.
- Dodge Momentum Index fell 7.3% in February to 250.0, marking the second consecutive monthly decline, with commercial planning down 8.9% and institutional planning off 4.0%.
- 23 projects valued at $100M or more entered planning in February despite the overall decline, suggesting mega-project activity remains strong even as the broader pipeline cools.
- West Virginia advances E-Verify expansion that would require all employers in the state to verify worker authorization, adding to the patchwork of state-level compliance requirements contractors must navigate.
Market Moves: Backlog Rebounds But The Gap Between Haves and Have-Nots Is Growing
The Associated Builders and Contractors (ABC) Construction Backlog Indicator rose to 8.1 months in February 2026, based on a member survey conducted February 20 through March 6. That is up 0.1 months from January’s reading, which had marked a four-year low. But it is still down 0.2 months from February 2025, signaling that the overall market has not recovered to prior-year levels.
The real story is not in the headline number. It is in the gap between contractors positioned in high-demand sectors and those who are not. Firms with data center contracts carry 11.2 months of backlog. Firms without data center work sit at 7.6 months. That is a 47% spread, and it has been widening for three consecutive quarters.
For construction business owners in the $1M to $50M revenue range, this gap represents both a warning and an opportunity. If your backlog is closer to the 7.6-month average, you are operating with less than eight months of visibility into your revenue pipeline. That is tight. If you are trending below that number, you are approaching a danger zone where one delayed project or one lost bid can create a cash flow crisis.
Regional data adds another layer of concern. The Middle States region is the only geography where backlog is higher than one year ago. Every other region in the country has seen year-over-year declines. This geographic concentration means that contractors outside the Middle States corridor, particularly in the South and West where data center and infrastructure activity has been strong, are seeing a normalization that could feel more like contraction if they are not diversified.
Large contractors continue to carry significantly more backlog than smaller firms. This is not new, but the magnitude of the gap is growing. The implication for mid-market contractors is clear: if you are not actively pursuing larger project sizes or positioning as a specialty subcontractor on mega-projects, you are competing in an increasingly crowded space for a shrinking share of available work.
The ABC Contractor Confidence Index showed mixed signals. Sales expectations and staffing level expectations both improved in February. But profit margin expectations fell, suggesting that even contractors with healthy backlogs are feeling pressure on the bottom line. This is consistent with what we have been tracking for months: revenue growth is possible, but margin compression is the dominant trend for firms that have not locked in material prices or built in adequate escalation clauses.
The practical takeaway for a contractor running a $5M to $20M operation: your backlog number alone does not tell the full story anymore. You need to know what sectors are feeding your pipeline, whether those sectors are growing or contracting, and whether you have the workforce and bonding capacity to pursue work in the segments that are actually expanding.
Big Money: BlackRock’s $100M Future Builders Bet on Skilled Trades
BlackRock, the world’s largest asset manager with over $11.5 trillion under management, announced its Future Builders initiative on March 11, 2026. The program commits $100 million in grant capital over five years to nonprofit and workforce development partners across multiple states. The stated goal is to reach 50,000 workers in the skilled trades, specifically electricians, plumbers, and HVAC technicians.
This is not philanthropy in the traditional sense. BlackRock manages more than $3 trillion in infrastructure-related assets globally. Every data center, power plant, water treatment facility, and transportation hub in their portfolio requires skilled tradespeople to build and maintain. When BlackRock CEO Larry Fink warns publicly that the U.S. could “run out of electricians needed to build AI data centers,” he is protecting the return profile of the firm’s infrastructure investments.
The program takes a comprehensive approach. It covers pre-apprenticeship access, meaning outreach and preparation programs to get workers into the pipeline. It funds training completion and licensure, addressing the dropout problem that plagues many apprenticeship programs where fewer than 50% of participants finish. And it embeds financial education and digital savings tools to help workers build long-term economic security.
The announcement was made at BlackRock’s U.S. Infrastructure Summit alongside elected officials and labor leaders. Additional phases of Future Builders will be announced over the next 12 months.
For contractors in the $1M to $50M range, the implications are both strategic and operational. On the strategic side, this is a massive signal about where institutional capital sees the construction industry heading. The biggest money in the world is betting that the trades labor shortage will be the binding constraint on infrastructure development for the next decade. If you are not already investing in workforce development, apprenticeship programs, or training partnerships, you are falling behind the curve that BlackRock has just publicly validated.
On the operational side, the Future Builders pipeline will eventually produce trained, licensed tradespeople looking for employment. Contractors who build relationships with the nonprofit partners administering these programs will get first access to graduates. This is particularly valuable for electrical and mechanical contractors who are already paying premium wages and still cannot fill positions.
The timing also aligns with CONEXPO-CON/AGG 2026, which just wrapped in Las Vegas with over 140,000 professionals from 128 countries. The show spanned more than 3 million square feet of exhibit space with over 2,000 exhibitors. Workforce development was one of the five key themes alongside AI, electrification, autonomous equipment, and 3D printing. The industry’s biggest gathering and its biggest investor are saying the same thing: the labor problem is not going away, and the companies that solve it will win.
Tech and Innovation: 6 Contech Startups Raise $126M as AI Safety and Payments Heat Up
Construction technology investment continues to flow into solutions that address the industry’s most persistent pain points: safety, documentation, equipment management, and payments. Six contech startups raised a combined $126 million in recent funding rounds, signaling sustained investor confidence in the digital transformation of construction.
Fyld led the pack with a $41 million Series B round led by Energy Impact Partners LP, with European growth equity specialist Partech participating through its growth impact fund. The London-based company provides reality capture software and ended 2025 with 82% year-over-year growth. Fyld’s platform uses AI to analyze jobsite imagery for safety compliance and progress tracking, addressing the documentation gap that costs contractors millions in disputes, rework, and OSHA violations annually.
Sensera Systems raised $27 million in a Series B round led by 10 Atlantic Group, with additional investment from Egis Capital Partners and MUUS Asset Management. Based in Golden, Colorado, Sensera’s SiteCloud platform helps contractors stay ahead of OSHA violations by using AI to interpret jobsite images and flag safety concerns in real time. For a mid-market GC running five to ten active jobsites, this type of automated safety monitoring can reduce incident rates and lower insurance premiums, a direct impact on the bottom line.
Moab raised $16 million across Seed and Series A rounds. The New York-based startup is building an operating system for equipment rental and dealership businesses, integrating operations, dispatch, billing, accounting, telematics, and CRM into a single platform. If you are running a fleet of owned or rented equipment across multiple jobsites, Moab’s approach to unified equipment management addresses the fragmented spreadsheet-and-phone-call systems that most mid-market contractors still rely on.
Payra raised $15 million in growth equity from Edison Partners. The Nashville-based company focuses on B2B payments and accounts receivable for construction and building supplier companies, modernizing cash collection from within existing ERP systems. Cash flow is the number one killer of construction businesses, and Payra’s ability to accelerate receivables without forcing contractors to rip out their existing accounting systems makes it particularly relevant for firms scaling past $5M in revenue.
Two additional companies rounded out the $126M total with smaller rounds focused on preconstruction and project estimation tools.
The pattern across all six raises is clear: investors are funding solutions that reduce risk and accelerate cash. Safety monitoring, documentation, equipment utilization, and payment acceleration are not glamorous, but they are the exact problems that keep construction CEOs up at night. The companies raising money are the ones building products that directly impact the metrics that matter: incident rates, days sales outstanding, equipment utilization rates, and rework percentages.
For contractors evaluating their technology stack, these raises provide a useful market signal. The tools getting funded are the tools that the smartest operators in the industry are already adopting. If your safety documentation is still clipboard-based, if your equipment tracking lives in a spreadsheet, or if your receivables process depends on someone making phone calls, you are operating with systems that institutional investors have identified as obsolete.
Planning and Confidence: Dodge Momentum Index Drops 7.3% for Second Straight Monthly Decline
The Dodge Momentum Index (DMI), issued by Dodge Construction Network, declined 7.3% in February to 250.0 (on a 2000=100 base) from the downwardly revised January reading of 269.8. This marks the second consecutive monthly decline following January’s 6.3% drop.
The breakdown by sector tells an important story. Commercial planning fell 8.9%, with slowdowns across nearly all commercial sectors except warehouses. Institutional planning declined 4.0%, with all institutional sectors slowing and public buildings facing the largest contraction.
According to Sarah Martin, Associate Director of Forecasting at Dodge Construction Network, “Planning momentum continued to normalize in February after a surge in activity in the back half of 2025.” The language is careful but the message is clear: the planning pipeline that built up through late 2025 is now working through the system, and new project entries are slowing.
However, there are important caveats that prevent this from being a straightforward bearish signal. 23 projects valued at $100 million or more entered planning in February, many of them data center and infrastructure related. The mega-project pipeline remains robust even as the broader market normalizes.
Martin also noted that “elevated risks around costs, labor, and geopolitics will continue to constrain builder confidence in the near-term, but the robust planning pipeline suggests an acceleration in construction spending in 2027.” This is the Dodge view: near-term headwinds, but a strong 2027 driven by projects currently in planning.
For mid-market contractors, the DMI decline has practical implications for business development. A slower planning pipeline today means fewer bid opportunities 12 to 18 months from now. If you are primarily dependent on public bid boards and plan rooms for your project pipeline, you should expect increased competition on a smaller number of available projects through late 2026 and into early 2027.
The exception is in sectors tied to data center, energy, and critical infrastructure development, where planning activity remains elevated. Contractors who have positioned themselves in these sectors are operating in a fundamentally different market than those competing for traditional commercial and institutional work.
The warehouse sector stands out as the lone bright spot in commercial planning. As e-commerce continues to drive demand for distribution and fulfillment centers, warehouse construction remains one of the more accessible sectors for mid-market general contractors and specialty subcontractors, particularly in logistics corridors in the Southeast and Southwest.
Policy and Regulation: West Virginia Advances E-Verify Expansion for All Employers
West Virginia’s legislature is advancing HB 4198, the “E-Verify Safe Harbor Act,” which would require every employer in the state to enroll in the federal E-Verify system and verify that all employees are legally authorized to work in the United States. The bill advanced through the Senate Judiciary Committee on March 11, though not without significant debate.
The bill requires every covered employer to maintain an active E-Verify account. Participation is not optional. If you are an employer covered under the legislation, you must be in the system. The bill also makes it unlawful to knowingly hire unauthorized workers, with penalties for non-compliance.
Business opposition has been vocal. Committee member Sen. Eric Tarr (R-Putnam), himself a business owner, stated, “This bill. I feel like the intent is to entrap businesses.” Other committee members who initially supported the bill raised concerns about overregulation and the practical burden on employers, particularly small businesses that may lack the HR infrastructure to manage E-Verify compliance.
For construction contractors operating in West Virginia or states considering similar legislation, this is a compliance issue that requires immediate attention. The construction industry employs a disproportionate share of workers whose documentation status may be subject to scrutiny. An E-Verify mandate does not just add an administrative step; it potentially constrains your labor pool at a time when the industry is already short 500,000+ workers nationally.
West Virginia joins a growing number of states expanding E-Verify requirements. The trend is accelerating under current federal policy direction, and contractors who operate across state lines need to track requirements in every jurisdiction where they work. A compliance failure in one state can trigger insurance, bonding, and licensing consequences that affect your ability to bid work in other states.
The practical response for contractors: if you are not already using E-Verify voluntarily, get your systems and processes in place now. Do not wait for a mandate. The administrative setup takes time, and the learning curve for your HR or office staff is real. Many GCs are already requiring E-Verify compliance from their subcontractors as a prequalification requirement, so getting ahead of this trend protects both your labor supply and your ability to win work on larger projects.
What This Means For Your Business
The construction market in March 2026 is defined by divergence. The gap between firms positioned in high-growth sectors and everyone else is widening across every metric: backlog, planning pipeline, technology adoption, and workforce access.
Here is how to read the data and act on it:
1. Audit your backlog composition. If your backlog is below 8.1 months, you are below the national average. If it is below 7.6 months, you are below the average for firms without data center work. Know your number, know what sectors are feeding it, and know where you need to diversify.
2. Position for data center and infrastructure subcontracting. The 47% backlog gap between data center and non-data-center contractors is not closing. It is widening. Even if you are not a GC on data center projects, there are subcontracting opportunities in electrical, mechanical, concrete, and site work. Start building relationships with the GCs winning this work now.
3. Connect with BlackRock’s Future Builders partners. As the program deploys $100M to workforce nonprofits, contractors who engage with these organizations early will get first access to trained, licensed graduates. This is particularly valuable for electrical and HVAC contractors who cannot find enough qualified workers at any price.
4. Evaluate your technology stack against what is getting funded. If venture capital is pouring $126M into AI safety, equipment management, and payment automation, that tells you where the industry is heading. The tools that are getting funded today become the table-stakes requirements for prequalification on major projects within 24 months.
5. Watch the planning pipeline, not just the backlog. The Dodge Momentum Index has declined for two straight months. That translates to fewer bid opportunities 12 to 18 months from now. If your business development strategy is reactive, waiting for projects to hit the bid boards, you need to shift to proactive relationship building and negotiated work now, before the pipeline tightens further.
6. Get E-Verify ready. Whether West Virginia’s bill passes or not, the trend toward mandatory E-Verify is accelerating at both state and federal levels. Getting your systems in place now is cheaper and less disruptive than scrambling when a mandate hits your state.
How do I interpret backlog data for my business size?
The ABC Backlog Indicator represents an average across all member firms, but averages can be misleading. Larger contractors typically carry significantly more backlog than smaller firms. If you are running a $3M to $10M operation, your healthy backlog might be 6 to 8 months. If you are at $20M or above, you should target 8 to 10 months. The key is tracking your own trend line over time and comparing it to sector-specific data rather than the overall average.
What does the data center backlog gap mean for contractors who do not do data center work?
It means increased competition for a shrinking share of available work in traditional commercial and institutional sectors. As more contractor capacity chases data center opportunities, firms that remain in conventional markets may see slightly less competition in the near term, but they also miss out on the premium margins and longer-duration contracts that data center work provides. The strategic move is to identify one or two specialty areas where your capabilities overlap with data center requirements, such as concrete, electrical, or mechanical, and start pursuing subcontracting opportunities.
How can a mid-market contractor connect with BlackRock’s Future Builders workforce pipeline?
BlackRock will be deploying funds through nonprofit and workforce development partners over the next 12 months. Watch for announcements of partner organizations in your region. Local workforce investment boards, community colleges with trades programs, and apprenticeship intermediaries are the most likely recipients. Engage with these organizations proactively by offering to host apprentices, participate in advisory boards, or provide jobsite learning opportunities. Contractors who are visible in the workforce development ecosystem get first access to graduates.
Should I be worried about the Dodge Momentum Index decline?
Not in isolation, but in context, yes. Two consecutive monthly declines of 6%+ suggest that the planning pipeline is normalizing after a strong second half of 2025. The 23 mega-projects that entered planning in February indicate that large-scale activity remains robust, but mid-market project opportunities may thin out. If your pipeline is heavily dependent on projects in the $1M to $20M range, expect more competitive bidding through the end of 2026. Diversifying your business development channels beyond traditional plan rooms and bid boards is the best hedge.
What contech tools should I be evaluating right now?
Focus on the categories where investor money is flowing and where ROI is most immediate: AI-powered safety monitoring platforms like Fyld and Sensera that reduce incident rates and insurance costs, equipment management systems like Moab that improve utilization rates and reduce idle time, and payment automation tools like Payra that accelerate receivables and improve cash flow. Start with the pain point that costs your business the most money today, whether that is safety incidents, equipment downtime, or slow-paying customers, and evaluate tools in that category first.