2026 Civil Infrastructure Construction Index: Second Quarter
Executive Summary
The 2026 Civil Infrastructure Construction Index (CICI) fell to 50.1 during the second quarter from 52.1 in the first, a broad-based decline that essentially brings it to the neutral line. Eight of nine components fell quarter over quarter; only productivity offered a modest bright spot (up to 50.0 from 49.0). The reading does not signal that work has disappeared, but is a clear indication that the conditions under which work is being won and delivered have grown materially harder. A common theme among interviewees is a sense of bifurcation on this point: the market seems to be getting more competitive for the smaller, hard-bid projects, but growing opportunity and limited competition continue for larger or more complex (potentially collaborative delivery) projects.
Key Takeaways
- The CICI slipped to 50.1 in Q2 2026 from 52.1 in Q1, reflecting a broad cooling in sentiment. Eight of nine index components declined quarter over quarter, with only productivity ticking up modestly.
- Cost pressures reversed sharply. The materials index dropped to 25.0 from 35.4, and the labor index fell to 23.9 from 29.2; 52% of respondents report increases in both categories. Tariff-driven escalation is a primary contributor.
- Backlog expectations remain positive at 54.7 but are decelerating. The book-to-burn rate fell steeply to 48.9 from 56.3, signaling thinning pipelines for a widening share of firms.
- Margins are compressing. Thirty-five percent of firms report lower margins year over year, and none report significantly higher margins. Competition has intensified, with 71% noting increases and softening bid prices.
- Digital infrastructure and megaprojects are concentrating construction activity in specific geographies and challenging labor capacity.
- The workforce challenge gelled around field leadership, with field staff management roles the hardest to fill (59%) and firms responding with heavy investment in leadership development.
