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AIA: Construction Forecast Inches Upward, But Remains Weak
After sinking to its lowest level ever in March, indicating a rapid slowdown in billings at U.S. architecture firms, the Architecture Billings Index (ABI) rose slightly in April, but remains low overall, the American Institute of Architects (AIA) reported.
After sinking to its lowest level ever in March, indicating a rapid slowdown in billings at U.S. architecture firms, the Architecture Billings Index (ABI) rose slightly in April, but remains low overall, the American Institute of Architects (AIA) reported.
As an economic indicator of construction activity, the ABI shows an approximate nine to twelve month lag time between architecture billings and construction spending. The the April ABI rating was 45.5, up from the historic low mark of 39.7 in March
Any score above 50 indicates an increase in billings.
The inquiries for new projects score was 53.9.
“After dropping rapidly the past two months, this uptick shows that the slowdown is beginning to moderate,” says AIA Chief Economist Kermit Baker, PhD, Hon. AIA. “Even though the downturn in design billings has come on very quickly, most areas of the country aren’t showing signs of an oversupply of nonresidential facilities. That provides hope that this weak patch may be relatively short-lived.”
Key April ABI highlights:
• Regional averages: South (46.6), Northeast (41.6), Midwest (41.6), West (37.7)
• Sector index breakdown: institutional (50.4), mixed practice (45.2) commercial / industrial (39.3) multi-family residential (33.5)
• Project inquiries index: 53.9
About the AIA Architecture Billings Index
The Architecture Billings Index is derived from a monthly “Work-on-the-Boards” survey and produced by the AIA Economics & Market Research Group. Based on a comparison of data compiled since the survey’s inception in 1995 with figures from the Department of Commerce on Construction Put in Place, the findings amount to an economic indicator that provides an approximately nine to twelve month glimpse into the future of nonresidential construction activity.
The diffusion indexes contained in the full report are derived from a monthly survey 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. According to the proportion of respondents choosing each option, a score is generated, which represents an index value for each month.
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