Construction stress snapped back up in March after one of its lowest readings in more than a year, according to the latest data from Cincinnati-based ConstructConnect.
The Project Stress Index, a measure of construction projects that have been paused, abandoned or exhibit a delayed bid date, increased 4.2% month over month in March. A 22.8% surge in project abandonments, which ConstructConnect linked to impacts from the Iran War, caused the increase.
“This escalation marks the largest month-over-month rise in abandonments since late 2025, when stress conditions heightened during the longest government shutdown in U.S. history,” Devin Bell, associate economist at ConstructionConnect, told Construction Dive. “The current increase in abandonments coincides with the developing conflict with Iran, as it continues to disrupt the flow of key goods through the Strait of Hormuz.”
On a positive note, delayed bid activity and on-hold projects fell 1.2% and 9.9% month over month, respectively.
Despite the monthly uptick, stress levels sat higher at this time last year when contractors pulled back due to elevated interest rates and concerns over President Donald Trump’s introduction of tariffs. Since then, the stress index has eased 3.5%, according to ConstructConnect.
Nevertheless, contractors over the past year have reported a strain on private construction activity, especially for work outside of the data center boom. Without data center projects, planning for commercial construction is down 12.7% since March 2025.
“March’s rise in abandonments has predominantly impacted the private sector,” said Bell. “The combination of already elevated construction input costs and disrupted oil trade flows is potentially driving private sector owners and developers to abandon projects as they grapple with escalating input costs.”
Input costs surged at a 12.6% annualized rate during the first two months of 2026. Economists warned those pressures would likely only intensify in the months ahead, as the latest data preceded the Iran war’s impact on oil prices.
Public and private project abandonments declined 17.2% and 4.6%, respectively, compared to this time last year. Meanwhile, over the past 12 months, public projects placed on hold increased 9.4%, while private work placed on hold plunged 79.7%, according to ConstructConnect.
“The decline in private on-holds is primarily due to the high levels we tracked in the first half of 2025,” said Bell. “Now, private on-holds have returned to levels much closer to historic averages.”
