Economy
Architectural Billings Index Declines for 11th Month
Written by Sandy Williams
February 26, 2021
Billings continued to decline at architecture firms in January, marking the 11th consecutive month of deterioration, reported the American Institute of Architects (AIA). The January Architecture Billings Index remained in contraction at 44.9, but firms are encouraged by an increase in work inquiries. The new projects inquiries index rose from 52.4 in December to 56.8 in January. Value of design contracts also improved after two months of decline.
On a region-by-region basis, demand for project design remained below the 50 neutral mark in all four regions, with the Northeast at just 41.9 in January. Design demand in the South moved slightly higher with a score of 47.4 in January, up from 46.8 in December. The Midwest posted at 42.2 and the West 42.8.
Billing in all sectors declined with readings below 50: commercial/industrial, 44.3; institutional, 33.9; and multifamily residential, 44.4. Comments from the Work-on-the-Boards participants indicate projects are smaller than they were pre-pandemic.
Firms expressed some optimism regarding business conditions in 2021. Nearly two-thirds of firms expect their revenues to return to pre-pandemic levels by the end of the year.
“The broader economy entered a soft spot during the fourth quarter of last year, and business conditions at design firms have reflected this general slowdown,” said AIA Chief Economist Kermit Baker. “While federal stimulus and the increasing pace of vaccinations may begin to accelerate progress in the coming months, the year has gotten off to a slow start, with architecture firms in all regions of the country and in all specializations reporting continued declines in project billings.”
Sandy Williams
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