Architecture Billings Index Remained Positive at 50.1 in June

July 19, 2023 from Floor Focus FloorDaily News

Washington, DC, July 19, 2023 – The Architecture Billings Index (ABI) score of 50.1 for June indicates that billings at architecture firms remained steady as design activity continues to slowly recover from roiled economic conditions, according to the American Institute of Architects (AIA) and Deltek.

This also marks the first time since last fall that there have been two consecutive months of scores above 50, although growth in June was weaker than May (any score above 50 indicates an increase in firm billings).

“It is encouraging to see two consecutive months of stability in billings after a couple quarters of weakness due to high inflation, rising interest rates, and increased construction costs,” said AIA chief economist Kermit Baker, PhD, Hon. AIA. “We are still facing some headwinds in the broader economy, but this respite suggests that market conditions may be finding firmer ground.”

Firms located in the Midwest continue to report the strongest billings for the eighth consecutive month, while firms in nearly all regions of the country also reported improving business conditions in June. Firms also reported that inquiries into new projects fell slightly from 57.2 to 56.7 the previous month. Further, the value of new design contracts edged up to 52.7 in June from 52.3 in May.

Firm backlogs have decreased from their record-high levels in 2022 but remain robust at an average of 6.8 months.

Regional averages were as follows: Midwest (52.4); Northeast (50.6); South (50.5); West (48.6).

The sector index breakdown was institutional (55.4); mixed practice (firms that do not have at least half of their billings in any one other category) (48.8); commercial/industrial (47.8); multi-family residential (47.4).

The project inquiries index was 56.7, and the design contracts index was 52.7.

Related Topics:The American Institute of Architects