While backlog is still below its cyclical peak from early 2022 , it has remained essentially flat in recent months , he said . That indicates a more steady environment for the sector than seen in residential construction , which has been hammered by rising mortgage rates .
The heightened expectations come as many nonresidential contractors are operating at capacity , Basu said . Principal challenges in the sector relate to supply-side issues like worker shortages , equipment delivery delays and elevated materials prices , as opposed to demand for their services , the typical hallmark of a weaker environment in the sector .