The last three months have shown steadily increasing demand for design services and the Architecture Billings Index (ABI) is now at its highest level since 2007.
The American Institute of Architects (AIA) reported the July ABI score was 55.8, up noticeably from a mark of 53.5 in June. This score reflects an increase in design activity (any score above 50 indicates an increase in billings). The new projects inquiry index was 66.0, following a very strong mark of 66.4 the 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.
The AIA has added a new indicator measuring the trends in new design contracts at architecture firms that can provide a strong signal of the direction of future architecture billings. The score for design contracts in July was 54.9.
“Business conditions for the design and construction marketplace, and those industries associated with it, appear to be well-positioned for continued growth in the coming months,” said AIA Chief Economist Kermit Baker, Hon. AIA, PhD. “The key to a more widespread boost in design activity continues to be the institutional sector which is starting to exhibit signs of life after languishing for the better part of the last five-plus years.”
Key July ABI highlights:
- Regional averages: Northeast (55.5), South (55.1), Midwest (54.1), West (53.5)
- Sector index breakdown: mixed practice (61.0), multi-family residential (56.5), institutional (53.3), commercial / industrial (51.2)
- Project inquiries index: 66.0
- Design contracts index: 54.9
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. The diffusion indexes contained in the full report are derived from a monthly “Work-on-the-Boards” survey that is sent to a panel of AIA member-owned firms. Participants are asked whether their billings increased, decreased, or stayed the same in the month that just ended as compared to the prior month, and the results are then compiled into the ABI.
These monthly results are also seasonally adjusted to allow for comparison to prior months. The monthly ABI index scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline. The regional and sector data are formulated using a three-month moving average. More information on the ABI and the analysis of its relationship to construction activity can be found in the recently released White Paper, Designing the Construction Future: Reviewing the Performance and Extending the Applications of the AIA’s Architecture Billings Index on the AIA website.
Related Stories
| Feb 17, 2012
MacInnis joins Gilbane board of directors
MacInnis is the chairman and recently retired CEO of Connecticut-based EMCOR Group, Inc.
| Feb 16, 2012
Gain greater agility and profitability with ArchiCAD BIM software
White paper was written with the sole purpose of providing accurate, reliable information about critical issues related to BIM and what ArchiCAD with advanced technology such as the GRAPHISOFT BIM Server provide as an answer to address these issues.
| Feb 16, 2012
TLC Engineering for Architecture opens Chattanooga office
TLC Engineering for Architecture provides mechanical, electrical, structural, plumbing, fire protection, communication, technology, LEED, commissioning and energy auditing services.
| Feb 16, 2012
Summit Design + Build begins build-out for Emmi Solutions in Chicago
The new headquarters will total 20,455 sq. ft. and feature a loft-style space with exposed masonry and mechanical systems, 15 foot clear ceilings, two large rooftop skylights and private offices with full glass partition walls.
| Feb 16, 2012
Highland named president of McCarthy Building Companies’ California region
Highland moved into this new role in January 2012 following a six-month transition period with Carter Chappell, the company’s former president, California region.
| Feb 16, 2012
Big-box retailers not just for DIYers
Nearly half of all contractor purchases made from stores like Home Depot and Lowe's.
| Feb 16, 2012
4.8-megawatt solar power system completed at Jersey Gardens Mall
Solar array among the largest rooftop systems in North America.
| Feb 15, 2012
Fourth-generation Ryan to lead Ryan Companies AE team
Ryan leads a team of eight architects, four civil engineers, two landscape architects and two virtual building specialists in their efforts to realize their customer’s vision and needs through Ryan’s integrated project delivery system.
| Feb 15, 2012
NAHB sees gradual improvement in multifamily sales for boomers
However, since the conditions of the current overall housing market are limiting their ability to sell their existing homes, this market is not recovering as quickly as might have been expected.
| Feb 15, 2012
Skanska secures $87M contract for subway project
The construction value of the project is $261.9 M. Skanska will include its full share, $87 M, in the bookings for Skanska USA Civil for the first quarter 2012.
