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ConstructConnect's Project Stress Index is a new resource that tracks changes in the level of projects that are delayed, placed on hold, or abandoned based on weekly construction activity data.
Project Stress Index: -9.3% YOY
ConstructConnect’s Project Stress Index for the 30-day period ending July 1, 2023, finished 9.3% lower than its year-ago level, and 2.6% higher than a week ago. Compared to a week ago, the level of projects that were abandoned or had their bid date delayed increased, while the level of projects on hold declined. In the final week of the second quarter, only the level of projects on hold is significantly different from year-ago results, with a substantial 24% decrease. This contrasts markedly with the minimal year-on-year difference measured in the Index’s two other stress series.
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Projects with Delayed Bid Dates
The level of delayed bid projects—the most common but also the lowest form of measured project stress—increased by 7% in the latest week, narrowing its year-on-year change to just -4%. While it is worth noting that delayed bid levels, especially during the first quarter of the year, witnessed a sustained lull compared to a year ago, recent months of rising readings have only returned the series to near year-ago levels.
Projects On Hold
The level of projects on hold fell for a second week, extending a declining trend that began in late May. At the end of the second quarter, the series had fallen by nearly 24% from its year-ago levels, making it the only series that remains substantially different based on year-ago comparisons.
Projects Abandoned
Although a relatively small proportion of all stressed projects, abandoned projects represent the highest form of project stress. The downward trajectory of weekly abandoned project levels since April has diverged from cyclical expectations, which anticipate increasing counts through the third quarter. Declining numbers of abandoned projects in today’s rising interest-rate environment may be an indicator of the industry’s strength and of the resilient demand for construction work.
About the Project Stress Index
The Project Stress Index (PSI) monitors the level of U.S. construction projects, excluding single-family residential, that have experienced a bid date delay, have been placed on hold, or have been abandoned over the last 30 days. Each component has been indexed against the average of their weekly values recorded during 2021. The independent tracking of each status type gives unique insights into the timing, direction, and amplitude of market changes.
