Economy Sours: AIA Construction Index Falls to New Low
The Architecture Billings Index (ABI) dropped two points in March to its lowest level since 1995, according to the American Institute of Architects (AIA).
The Architecture Billings Index (ABI) dropped two points in March to its lowest level since 1995, according to the American Institute of Architects (AIA).
The March ABI rating dropped to 39.7, following a 9-point decline in February. Any score above 50 indicates an increase in billings. The score for inquiries for new projects was 48.0, also the lowest mark for the survey.
“We’ve seen an 11-point fall-off in the first quarter of the year and the prognosis for commercial construction later this year is not favorable at this point,” says Kermit Baker, AIA chief economist. “Aside from historically low project demand, all regions are showing very poor business conditions. This is not likely to reverse itself anytime soon.”
As an economic indicator of construction activity, the ABI shows an approximate nine to twelve month lag time between architecture billings and construction spending. It is derived from a monthly “Work-on-the-Boards” survey and produced by the AIA Economics & Market Research Group.
Key March ABI highlights include:
Regional averages: South (45.3), Northeast (38.7), West (38.7), Midwest (36.9)
Sector index breakdown: institutional (50.8), commercial / industrial (38.3) multi-family residential (31.7)
Project inquiries index: 48.0
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