Architecture Billings Index Rebounds After Two Down Months
After seeing consecutive months of contracting demand for the first time in four years, the Architecture Billings Index (ABI) saw a modest increase demand for design services. As a leading economic indicator of construction activity, the ABI reflects the approximate 9- to 12-month lead time between architecture billings and construction spending.
The American Institute of Architects (AIA) reported the October ABI score was 50.8, up from the mark of 48.4 in the previous month. This score reflects a slight increase in design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 55.4, down sharply from a reading of 59.4 the previous month.
“There was a collective sense of uncertainty throughout the design and construction industry leading up to the presidential election,” said AIA Chief Economist, Kermit Baker, Hon. AIA, PhD. “Hopefully we’ll get a sense of what direction we will be headed once we get a clearer read on how the new administration’s policies might impact the overall economy as well as the construction industry.”
Key October ABI highlights:
* Regional averages: South (53.7), West (49.7), Northeast (47.3) Midwest (46.8)
* Sector index breakdown: multi-family residential (51.2) commercial / industrial (49.8), mixed practice (49.5), institutional (49.1)
* Project inquiries index: 55.4
* Design contracts index: 48.7
The regional and sector categories are calculated as a 3-month moving average, whereas the national index, design contracts and inquiries are monthly numbers.