Thirty-five percent of the commercial contractors we surveyed are carrying at least nine months of backlog.
Forty-one percent have over a year of work already secured.
In an industry that runs on uncertainty, that's a position most contractors would have taken without hesitation two years ago.
But backlog doesn't pay the bills. Execution does. And that's where 2026 is getting complicated.
ServiceTitan surveyed more than 1,000 commercial owners, executives, GMs, and directors — conducted through Thrive Analytics from January 13 to 27, 2026 — to find out how commercial specialty contractors are thinking about the year ahead. What they told us paints a picture of an industry that has shifted its focus.
The question has shifted from how do we win more work to how do we actually make money on the work we have.
The Pressure Is in the Delivery Phase
Rising labor and overhead costs are the number one risk heading into 2026, cited by 35% of contractors, tied with skilled labor shortage.
Material prices aren't far behind at 32%.
When costs are climbing on every side, the margin on a job can erode before it's half finished. That's why 57% of those we surveyed identified timely billing as their top lever for protecting profitability. Not winning more bids. Not raising prices. Getting paid accurately and on time for the work already done.
The theme running through the data is the same one Raffi Elchemmas — a 10-year construction safety veteran and former Executive Director of Safety, Health, and Risk Management for the MCAA — sees on the ground: "For commercial contractors, the immense backlog of project work now outweighs the persistent pressures of labor and overhead. In this environment, the most critical strategic opportunity for 2026 success is the consolidation of fragmented technology into a single, unified system."
Most Contractors Are Running on Too Many Systems
Only 20% of those we surveyed have reached a single-platform state. The rest are managing operations across fragmented tools — 34% use two to three systems, and 25% rely on four to six. Every handoff between those systems is a place where data gets lost, decisions get delayed, and margin gets left behind.
The most widely adopted core systems — accounting, project management, estimating, time tracking, and bid management — rarely talk to each other.
Martin Laycock, Vice President of Finance & Administration at Iron Dog, put it plainly: "Demand remains steady, but labor constraints and cost inflation are putting real pressure on margins. Success in this environment requires disciplined execution and decisions grounded in accurate, real-time data from our core systems."
AI Is Moving From Curiosity to Utility
In 2025, 17% of commercial contractors said AI was affecting their business.
In 2026, that number is 38%.
The leading use cases are cost estimation and budgeting (24%), bid management (22%), and project planning and scheduling (21%).
Contractors aren't looking for AI to replace their judgment. They're looking for it to do the work that slows their teams down — the manual entry, the report generation, the data that should connect automatically and doesn't.
The contractors getting there fastest are the ones who've consolidated their tech stack first. When your operational data lives in one place, AI has something to work with.
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What's in the Full Report
The 2026 Commercial Specialty Contractor Industry Report covers:
The top eight business goals for 2026 — and what's driving the shift from revenue growth to margin protection
Where contractors are concentrating their efforts to survive pricing volatility
How proactive cash flow management is replacing reactive fire-fighting
The five ways commercial contractors are protecting liquidity in a high-cost environment
What the fragmented tech landscape is actually costing the average contractor — and what consolidation looks like in practice
