Catching up while things slow down.

• Position: Construction projects - Statistical Data Included

In the construction industry, times can never be too good -- though they have come pretty close. Starting in 1998, contractors found themselves swamped by public and private projects that left them facing labor and material shortages. The job backlog -- the average amount of work contractors had under way or scheduled -- reached a whopping 24 months early in 1999, according to industry sources.

Relief of a sort arrived as interest-rate hikes slowed building in 2000. The Carolinas Associated General Contractors Construction Barometer, which tracks commercial construction in North and South Carolina, recorded a dip in the fourth quarter of 1999 and the first quarter of last year. The index bobbed back up over spring and summer before dropping again. By winter, shortages of steel, drywall and other materials became less acute, and the backlog retreated to the 15-month range.

For contractors, it was a moment to catch up after a feverish two years, though most eyed the slowdown with suspicion. "We would like to slip back just a little bit," says Chuck Wilson, president of C.T. Wilson Construction Co. in Durham. "But you never know when that slip will turn into a slide."

The slowdown did not show up across the board. Barnhill Contracting Co. in Tarboro, for example, expects to record at least $225 million in revenue for 2000, up 5.1% from 1999. But Clancy & Theys Construction Co. of Raleigh, which recorded $284 million in revenues in 1999, predicted its total would drop 15.5% in 2000.

Tar Heel voters have made certain there will be work. In November, they approved a $3.1 billion bond issue for capital improvements to state universities and community colleges and $1.3 million in local bonds for roads, schools and other projects. "Without that bond money, I think there would be a lot more concern," says John Muter, vice president of the building division for Barnhill Contracting.

Contractors say the extra public work should offset a slightly less-robust private sector. Nonresidential construction pulled back in 1999, when the state recorded permits for $4.75 billion in construction, down 7% from 1998. There were 31,770 permits for commercial projects in 1999, a 3% drop from 1998.

Part of the downshift stems from completion of some megaprojects, including the $170 million Entertainment and Sports Arena in Raleigh, the $240 million Concord Mills mall in Concord and the $150 million Three First Union Center in Charlotte. Downtown Charlotte still has...