Economy Watch: Architects Busier in March, Bodes Well for Construction Spending
- Apr 21, 2016
The American Institute of Architects reported on Wednesday that the March Architecture Billings Index (ABI) came in at 51.9, up from the mark of 50.3 in February. The score reflects an increase in design service billings by architects (any score above 50 means an increase in billings). The new projects inquiry index was 58.1, down from 59.5 the previous month.
The Architecture Billings Index gauges demand for design activity at architecture firms. As such, it’s a leading economic indicator of construction activity, since the index reflects the roughly nine- to 12-month lead time between architecture billings and construction spending.
“The first quarter was somewhat disappointing in terms of the growth of design activity, but fortunately expanded a bit entering the traditionally busy spring season,” noted said AIA chief economist, Kermit Baker. The Midwest is lagging behind the other regions, he said, but otherwise business conditions for architects are generally healthy across the country.
The indexes are derived from a monthly “work-on-the-boards” survey sent to a panel of AIA member-owned firms. Participants are asked whether their billings increased, decreased, or stayed the same in the month that just ended as compared to the prior month, and the results are then compiled into the ABI.