As the prognosis for the design and construction industry continues to improve, the Architecture Billings Index (ABI) is reflecting its strongest growth since November 2007. As a leading economic indicator of construction activity, the ABI reflects the approximate nine to twelve month lag time between architecture billings and construction spending.
The American Institute of Architects (AIA) reported the January ABI score was 54.2, up sharply from a mark of 51.2* in December. This score reflects a strong increase in demand for design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 63.2, much higher than the reading of 57.9 the previous month.
“We have been pointing in this direction for the last several months, but this is the strongest indication that there will be an upturn in construction activity in the coming months,” said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. “But as we continue to hear about overall improving economic conditions and that there are more inquiries for new design projects in the marketplace, a continued reservation by lending institutions to supply financing for construction projects is preventing a more widespread recovery in the industry.”
Key January ABI highlights:
- Regional averages: Midwest (54.4), West (53.4), South (51.7), Northeast (50.3)
- Sector index breakdown: mixed practice (54.9), multi-family residential (54.5), commercial / industrial (52.0), institutional (50.2)
- Project inquiries index: 63.2
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 web site.
About The American Institute of Architects
Founded in 1857, members of the American Institute of Architects consistently work to create more valuable, healthy, secure, and sustainable buildings, neighborhoods, and communities. Through nearly 300 state and local chapters, the AIA advocates for public policies that promote economic vitality and public well being. Members adhere to a code of ethics and conduct to ensure the highest professional standards. The AIA provides members with tools and resources to assist them in their careers and business as well as engaging civic and government leaders, and the public to find solutions to pressing issues facing our communities, institutions, nation and world. Visit www.aia.org.
* Every January the AIA research department updates the seasonal factors used to calculate the ABI, resulting in a revision of recent ABI values.
Related Stories
| Mar 24, 2013
World's tallest data center opens in New York
Sabey Data Center Properties last week celebrated the completion of the first phase of an adaptive reuse project that will transform the 32-story Verizon Building in Manhattan into a data center facility. When the project is completed, it will be the world's tallest data center.
| Mar 22, 2013
8 cool cultural projects in the works
A soaring opera center in Hong Kong and a multi-tower music center in Calgary are among the latest cultural projects.
| Mar 22, 2013
Earn $500 as a DOE proposal reviewer
The DOE'S Building Technologies Office this morning put out a call to the AEC industry for expert reviewers for its new energy-efficiency initiative for small commercial buildings, which make up more than 90% of the commercial building stock.
| Mar 21, 2013
Best Firms to Work For: Enermodal Engineering is green to the core
At Enermodal Engineering, there’s only one kind of building—a sustainable one.
| Mar 21, 2013
Are charter schools killing private schools?
A recent post on Atlantic Cities highlights research by the U.S. Census Bureau's Stephanie Ewert that shows a correlation between the growth of charter schools and the decline in private school enrollment.
| Mar 20, 2013
Folding glass walls revitalize student center
Single-glazed storefronts in the student center at California’s West Valley College were replaced with aluminum-framed, thermally broken windows from NanaWall in a bronze finish that emulates the look of the original building.
| Mar 20, 2013
Architecture Billings Index up again in February
The American Institute of Architects reported the February ABI score was 54.9, up slightly from a mark of 54.2 in January. This score reflects a strong increase in demand for design services.
| Mar 18, 2013
Toyo Ito named 2013 Pritzker Architecture Prize recipient
Toyo Ito, a 71 year old architect whose architectural practice is based in Tokyo, Japan, will be the recipient of the 2013 Pritzker Architecture Prize.
