Economy

ABI Drops Back into Negative Territory

April 23, 2014

This seems to be a week of disappointing economic indicators. The Architecture Billings Index turned negative this month after climbing up from a reading of 48.6 in December. The March reading was just 48.8, down from 50.7 in February and 50.4 in January. The American Institute of Architects Architecture Billings Index, an indicator of future construction activity, reflects a nine to twelve month lead time between architectural billings and construction spending. Any score above 50 indicates an increase in billings.

“This protracted softening in demand for design services is a bit of a surprise given the overall strength of the market the last year and a half,” said AIA Chief Economist Kermit Baker, Hon. AIA, PhD. “Hopefully, some of this can be attributed to severe weather conditions over this past winter. We will have a better sense if there is a reason for more serious concern over the next couple of months.”

The new projects inquiry rose just over a point to 57.9 from a reading of 56.8 in February. AIA has added a new indicator that measures the trends in new design contracts and that index read 48.2 for the month.

Regionally, the 3-month moving average remained unchanged for the South at 52.8, the West gained 0.2 points to 50.7, the Northeast contracted further to 46.8 from 48.3, and the Midwest dropped 1 point to 46.6.

{amchart id=”64″ AIA ABI Index}