According to a North Carolina Construction News article, Associated Builders and Contractors report that its “Construction Backlog Indicator (CBI) remains unchanged at 8 months from the third quarter through the fourth quarter of 2012; however, it is up 2.4 percent compared to a year ago”.
That being said, what is the CBI and why does it matter that it was flat in 2012? “CBI is measured in months and reflects the amount of construction work under contract, but not yet completed by nonresidential contractors, which basically means it demonstrates the positive or negative level of construction in the U.S. Since the CBI didn’t decline, nonresidential construction spending could possibly increase later in the year of 2013. Also, according to Anirban Basu, an ABC Chief Economist, “backlog in the commercial construction category increased for a third consecutive quarter, a reflection of ongoing recovery in consumer spending, including tourism and growth in professional services employment. The year over year expansion in infrastructure is reflective of growing construction spending in categories such as power, utilities and transportation”.
Even though this is an increase in the CBI is for the entire U.S., it could still be a predicting factor for construction in North Carolina, specifically Charlotte, since there was expansionary growth in construction spending in transportation and a growth in professional services employment. Charlotte is a service-centered city and is growing rapidly, so it will need higher construction spending in the transportation sector in the near future.