On the heels of a nearly three-point increase, the Architecture Billings Index (ABI) climbed into positive terrain for the first time in five months. 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 August ABI score was 50.2, up from the mark of 48.7 in July. This score reflects an increase in demand for design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 57.2, up from mark of 56.3 the previous month.
“Until the economy is on firmer ground, there aren't likely to be strong increases in demand for design services,” said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. “In the meantime, we can expect to see design activity alternate between modest growth and modest decline.”
Key August ABI highlights:
- Regional averages: South 52.2, West 51.2, Northeast 45.5, Midwest 45.3
- Sector index breakdown: multi-family residential 53.0, institutional 50.2, commercial/industrial 47.9, mixed practice 46.8
- Project inquiries index: 57.2