Architecture billings dip in January, severe weather likely to blame

Following a nine-month stretch of positive billings, the Architecture Billings Index (ABI) showed no increase in design activity in January.

The American Institute of Architects reported the January ABI score was 49.9, down from a mark of 52.6 in December. This score reflects a very modest decrease in design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 58.7, up from the reading of 51.3the previous month.

As a leading economic indicator of construction activity, the ABI reflects the approximate nine to twelve month lead time between architecture billings and construction spending.

“This easing in demand for design services is a bit of a surprise given the overall strength of the market over the past nine months,” said AIA Chief Economist Kermit Baker, Hon. AIA, PhD. “Likely some of this can be attributed to severe weather conditions in January. We will have a better sense if there is a reason for more serious concern over the next couple of months.”

* Every January the AIA research department updates the seasonal factors used to calculate the ABI, resulting in a revision of recent ABI values.

Key December ABI highlights:

Regional averages: South (54.8), West (49.3), Midwest (50.8), Northeast (46.0)
Sector index breakdown: multi-family residential (51.4), institutional (53.0), commercial / industrial (50.9), mixed practice (46.9)
Project inquiries index: 58.7
Design contracts index: 51.3

The regional and sector categories are calculated as a 3-month moving average, whereas the national index, design contracts and inquiries are monthly numbers.

About the AIA Architecture Billings Index
The Architecture Billings Index (ABI), produced by the AIA Economics & Market Research Group, is a leading economic indicator that provides an approximately nine to twelve month glimpse into the future of nonresidential construction spending activity. More at: http://www.aia.org/practicing/economics/AIAS076265

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