ConstructConnect’s latest Project Stress Index (PSI) reading, which measures the level of non-residential projects that have experienced a delayed bid date, being placed on hold, or being abandoned, for June 2024 is up 1.5% from May. The figure of 112.7 is up 9% from June 2023.

As reported by Construction Dive, project abandonments increased by 10.7%, delayed bid activity saw no change, and work put on hold fell 6.6% over the past month. Since mid-May, weekly and monthly readings have roughly hovered between 110 and 113, which indicates that current levels of project stress are only slightly more than 10% above the average level recorded during the 2021 calendar year. 

“Among abandoned projects, it is very possible that this number is being fueled by only a few severely impacted subcategories,” said Michael Guckes, chief economist at ConstructConnect, to Construction Dive. “Chief among suspects are private offices which continue to gravely struggle against current financial market conditions.”

According to ConstructConnect, the most recent readings also indicate the PSI’s lowest point since its last surge began in September 2023. Previous low points have been short-lived, driven by sharp yet brief declines in abandonment activity. This phenomenon is evident in the May 2024 PSI reading, where abandonments experienced a substantial decline as readings fell to eight month lows.

Despite high abandonment activity, falling on-hold and bid-date delayed activity have allowed the PSI to reach and sustain some of the lowest readings recorded since the Federal Reserve began raising interest rates in early 2022. 

The latest PSI readings also indicate distinct trends in public and private projects. The decline in bid-date delayed projects has been particularly pronounced in private sector projects, whereas the decline in projects placed on hold is almost entirely due to the public sector. As noted by Construction Dive, public abandonment projects increased 3.6% year over year, while private project abandonments leaped 48.7%.