Economics
Architecture Billings Index Shows Decline for 20th Consecutive Month
The AIA/Deltek Architecture Billings Index has now shown 20 consecutive months of declining billings for member architecture firms surveyed.
Chart courtesy of American Institute of Architects
The Architecture Billings Index, which gives contractors an idea of nonresidential construction work nine months to a year later, continued its 20th consecutive month of declining billings in September, the American Institute of Architects and software firm Deltek announced Oct. 23.
The ABI remained at 45.7, the same score as in August. An ABI of 50 represents no change in billings from the previous month, while a score above would indicate an increase and a score below 50 shows a decline. AIA bases the ABI on monthly surveys of its member firms.
“Despite recent rate cuts by the Federal Reserve, many clients remain on the sidelines with regard to proceeding on planned projects,” Kermit Baker, chief economist at AIA, said in a statement. “And while new project opportunities also emerge, clients are cautious about which to pursue.”
Still, Baker also noted architecture firms reported backlogs averaging 6.4 months, which is above pre-pandemic levels. That’s “an indication that there is existing work in the pipeline,” he said.
More than a third of surveyed architects reported that they have seen an increase in reconstruction projects over the past few years. The most common types of reconstruction design work were building interior modernization, adaptive reuse, tenant fit-outs, building system upgrades and building shell upgrades.
Billings remained weakened across all regions. The West scored the lowest at 42.6, while the South was nearly flat at 49.5.
By sector, architects specializing in multifamily residential generally saw the greatest declines, with a score of 41.7. Firms doing institutional work were the least weak with a score of 48.5, while commercial and industrial firms scored 44.2.
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