Washington, D.C. – November 17, 2010 – Following the first positive reading since January 2008, the Architecture Billings Index (ABI) dropped nearly two points in October. As a leading economic indicator of construction activity, the ABI reflects the approximate nine to 12 month lag time between architecture billings and construction spending. The American Institute of Architects (AIA) reported the October ABI score was 48.7, down from a reading of 50.4 the previous month. This score reflects a decrease in demand for design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 61.7, down slightly from a nearly three-year high mark of 62.3 in September.
“This is disappointing news, but not altogether that surprising,” said AIA Chief Economist Kermit Baker, PhD, Hon. AIA. “We were anticipating a slow recovery period and it is likely that there will be some fits and starts before conditions show consistent improvement. Right now, reluctance from lending institutions to provide credit for construction projects and a sluggish economy are the main impediments to a revival of the design and construction industry.”
Key October ABI highlights:
Regional averages: Northeast (54.5), Midwest (51.8), South (48.6), West (44.3)
Sector index breakdown: commercial / industrial (54.5), institutional (50.8), multi-family residential (49.1), mixed practice (43.2)
Project inquiries index: 61.7
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 White Paper Architecture Billings as a Leading Indicator of Construction: Analysis of the Relationship Between a Billings Index and Construction Spending on the AIA web site.
About The American Institute of Architects
For over 150 years, members of the American Institute of Architects have worked with each other and their communities to create more valuable, healthy, secure, and sustainable buildings and cityscapes. By using sustainable design practices, materials, and techniques, AIA architects are uniquely poised to provide the leadership and guidance needed to provide solutions to address climate change. AIA architects walk the walk on sustainable design. Visit www.aia.org
Related Stories
| Jul 16, 2013
As the U.S. economy sputters back to life, contractors wait for the green light on projects [2013 Giants 300 Report]
There are enough positive indictors in the economy to justify greenlighting projects, but building owners and developers remain reluctant to pull the trigger.
| Jul 16, 2013
Robotics: A new way to demolish buildings
A robot prototype uses water jets to break up concrete structures and then sucks up the water and debris for reuse and recycling.
| Jul 15, 2013
Mergers and acquisitions transform engineering sector [2013 Giants 300 Report]
Merger and acquisition deals by MEP, commissioning, structural, and specialty engineering firms were up 14% nationwide in 2012 compared with 2011.
| Jul 15, 2013
Top Engineering/Architecture Firms [2013 Giants 300 Report]
Jacobs, AECOM, Parsons Brinckerhoff top Building Design+Construction's 2013 ranking of the largest engineering/architecture firms in the United States.
| Jul 15, 2013
Top Architecture/Engineering Firms [2013 Giants 300 Report]
Stantec, HOK, HDR top Building Design+Construction's 2013 ranking of the largest architecture/engineering firms in the United States.
| Jul 15, 2013
Top Architecture Firms [2013 Giants 300 Report]
Gensler, Perkins+Will, NBBJ top Building Design+Construction's 2013 ranking of the largest architecture firms in the United States.
| Jul 15, 2013
Zaha Hadid unveils plan for boutique condo development in New York
Related Companies taps the London-based architect for the 11-story 520 West 28th Street residential development adjacent to the High Line in Chelsea.
| Jul 12, 2013
12 award-winning healthcare projects [slideshow]
AIA's Academy of Architecture for Health announced the recipients of the 2013 AIA National Healthcare Design Awards.
| Jul 11, 2013
Bill to borrow more for college spending in Michigan criticized due to ‘higher-ed bubble’
An amendment to a Michigan appropriations budget authorizes an increase in state debt to pay for state university construction projects. But some experts see a “higher education bubble” on the horizon, and said more taxpayer debt for more buildings is a bad idea.