Following consistently increasing demand for design services throughout most of 2013, the Architecture Billings Index (ABI) has posted its first consecutive months of contraction since May and June of 2012.
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 American Institute of Architects (AIA) reported the December ABI score was 48.5, down from a mark of 49.8 in November. This score reflects a decrease in design services (any score above 50 indicates an increase in billings).
The new projects inquiry index was 59.2, up from the reading of 57.8 the previous month.
“What we thought last month was an isolated dip now bears closer examination to see what is causing the slowdown in demand for architectural services,” said AIA Chief Economist Kermit Baker, Hon. AIA, PhD. “It is possible that some of this can be attributed to the anxiety in the marketplace caused by the shutdown of the federal government, but it will be important to see how business conditions fare through the first quarter of the new year when we no longer have end of the year issues to deal with.”
Key December ABI highlights:
• Regional averages: West (53.2), South (51.2), Midwest (47.0), Northeast (42.8)
• Sector index breakdown: multi-family residential (53.8), mixed practice 51.0), commercial / industrial (47.1), institutional (44.8)
• Project inquiries index: 59.2
Note: The regional and sector categories are calculated as a 3-month moving average, whereas the index 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 White Paper Architecture Billings as a Leading Indicator of Construction: Analysis of the Relationship Between a Billings Index and Construction Spending on the AIA website.
Related Stories
| Feb 1, 2012
Two new research buildings dedicated at the University of South Carolina
The two buildings add 208,000 square feet of collaborative research space to the campus.
| Feb 1, 2012
List of Top 10 States for LEED Green Buildings released?
USGBC releases list of top U.S. states for LEED-certified projects in 2011.
| Feb 1, 2012
ULI and Greenprint Foundation create ULI Greenprint Center for Building Performance
Member-to-member information exchange measures energy use, carbon footprint of commercial portfolios.
| Feb 1, 2012
AEC mergers and acquisitions up in 2011, expected to surge in 2012
Morrissey Goodale tracked 171 domestic M&A deals, representing a 12.5% increase over 2010 and a return to levels not seen since 2007.
| Jan 31, 2012
AIA CONTINUING EDUCATION: Reroofing primer, in-depth advice from the experts
Earn 1.0 AIA/CES learning units by studying this article and successfully completing the online exam.
| Jan 31, 2012
28th Annual Reconstruction Awards: Modern day reconstruction plays out
A savvy Building Team reconstructs a Boston landmark into a multiuse masterpiece for Suffolk University.
| Jan 31, 2012
Chapman Construction/Design: ‘Sustainability is part of everything we do’
Chapman Construction/Design builds a working culture around sustainability—for its clients, and for its employees.
| Jan 31, 2012
Fusion Facilities: 8 reasons to consolidate multiple functions under one roof
‘Fusing’ multiple functions into a single building can make it greater than the sum of its parts. The first in a series on the design and construction of university facilities.
| Jan 31, 2012
Suffolk Construction to manage Lawrence & Memorial Hospital Cancer Center project in Waterford, Conn.
Leading construction management firm overseeing one of first healthcare projects in the country to utilize innovative IPD process.
| Jan 31, 2012
Perkins Eastman’s Miller appointed Chairman of the AIA International Committee
International expertise leveraged as global industry resource.