Continuing our reporting on the Architecture Billings Index, the ABI score slighly increased from 50.0 in January to 50.6 this past month. Although only a small jump, regional average for the Midwest and South remained over 50 (55.3 and 50.1 respectively), and the West and Northeast reported scores of 49.1 and 46.4. ”Overall demand for design services seems to be treading water over the last two months,” said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. “We’ve been preaching patience and cautious optimism for a full recovery because there continues to be a wide range of business conditions for architecture firms that are also influenced by firm size, practice specialties and regional location. We still expect the road to recovery to move at a slow, but steady pace.”
Following our recent updates about the Architecture Billings Index, the most recent news from the AIA shows a slight increase for the month of July. The American Institute of Architects reported the July ABI score was 47.9, up from a reading of 46.0 the previous month.
Although the score has increased, it still reflects a continued decline in demand for design services (any score above 50 indicates an increase in billings). The South region measured the highest with an average of 47.9, followed by the Northeast with 47.2, the Midwest with 46.7 and the West with 45.2.
“Business conditions at design firms remain quite volatile,” said AIA Chief Economist Kermit Baker, PhD, Hon. AIA. “While this recent uptick is encouraging, this state of the industry is likely to persist for a while as we continue to receive a mixed bag of feedback on the condition of the design market from improving to flat to being paralyzed by uncertainty.”
Time are still hard for our profession, but we’re hoping the ABI will continue to rise, no matter how sightly, each month.
Just over a month ago, we were happy to report that our field seemed to be through the toughest time, as the Architecture Billings Index had increased for the third straight month showing a sustained economic improvement. Now, we are definitely not so happy to share some information that a lot of architects assumed would happen. Following our strong spring, the AIA billings index dropped quite precipitously from 48.5 to 45.8 and every region declined. The rough month suggests that our recovery will continue to be long and frustrating, a worrisome reality that some professionals may have been anticipating. “I was a bit surprised by it, particularly the magnitude,” AIA Chief Economist Kermit Baker said. “It’s been jumping around for the past six to nine months, but this is a big drop after some pretty steady gains.”
We know these times are extremely difficult but we are still keeping our optimism and hoping for the best.
As seen on the Architect’s Newspaper
According to Bloomberg Newsweek, US Architects should be seeing signs of improvement as the Architecture Billings Index has increased for the third straight month, up from 46.1 in March to 48.5. Measured by the AIA, the Architecture Billings Index (ABI) serves as an indicator of future building for offices, warehouses and retail properties. The indexes are developed each month by asking AIA firm participants whether their billings increased, decreased, or stayed the same in the month that just ended. The score is generated based on the proportion of respondents choosing each option. Breaking the index down regionally, the Northeast fared the best with 51, followed by the Midwest at 49.2, the South at 46.5, and finally, the West at 44.7.
However, we know that statistics often times don’t clue us in on the real happenings, so we’d like to hear from you. What has been your experience? Do you feel that the economy is finally turning around and the worst is over? Or, are you worried, due to the latest economical problems with Greece and crisis of the Euro, that another crash is due to affect our profession?