By: Kendall Jones on August 22nd, 2018
July's Architecture Billings Index Reflects Declining Growth
Architecture firms had another strong month for billings in July, marking the 10th consecutive month of growth. Growth in billings has been slowing over the past couple of months. The Architecture Billings Index (ABI) score for July was 50.7, down from a score of 51.3 in June, per the latest report from the American Institute of Architects (AIA). Despite the recent slowing growth, billings haven’t dropped below 50 since September 2017.
For the ABI, all scores above 50 indicate an increase in billings and scores below 50 indicate a decrease in demand for design services. The ABI acts as a barometer for nonresidential construction starts with construction activity following architectural billings by nine months to a year.
The project inquiries index and the design contracts index in July boasted strong scores. The project inquiries index jumped from 56.0 in June to an impressive 60.5 in July. The design contracts saw a slight decrease from 54.1 in June to 53.8 in July. The ABI, along with the project inquiries index and the design contracts index have been strong all year.
Not all areas of the country are seeing increased demand for design activity. In fact, the South was the only region with a score above 50 in July. The South had a score of 55.2, which is down from the 57.4 in June. After dropping to a 46.9 in June, the West increased to 49.6 in July, staying just below 50. The Northeast declined from a solid 50.2 to a 48.0 for July. The Midwest fell again in July, going from a 49.8 in June to a 49.3.
Things fared a little better with the three-month averages for the various sectors. Multi-Family Residential led all sectors again with 54.6, the same score it posted in June. Institutional dropped again in July, going from a 51.6 in June to a 51.1. Commercial/Industrial fell a few points, going from 53.4 in June to 50.1 in July. Mixed Practice also declined in July to a score of 48.2 following a 49.3 in June and was the only sector to fall below 50.
About Kendall Jones
Kendall Jones is the Editor in Chief at ConstructConnect. He has been writing about the construction industry for years, covering a wide range of topics from safety and technology to industry news and operating insights.