Washington,
DC – July 20, 2016 – Buoyed by increasing levels of demand across all project
types, the Architecture Billings Index (ABI) was positive in June for the fifth
consecutive month. As a leading economic indicator of construction
activity, the ABI reflects the approximate nine to twelve month lead time
between architecture billings and construction spending. The American Institute
of Architects (AIA) reported the June ABI score was 52.6, down from the mark of
53.1 in the previous month. This score still reflects an increase in design
services (any score above 50 indicates an increase in billings). The new
projects inquiry index was 58.6, down from a reading of 60.1 the previous
month.
“Demand
for residential projects has surged this year, greatly exceeding the pace set
in 2015. This suggests strong future growth for housing in the coming year,”
said AIA Chief Economist, Kermit Baker, Hon. AIA, PhD. “While we expect to see momentum
continue for the overall design and construction industry in the months ahead,
the fact that the value of design contracts dipped into negative territory in
June for the first time in more than two years is something of a concern.”
Key
June ABI highlights:
- Regional averages: South (55.5), West (54.1), Northeast (51.8), Midwest (48.2)
- Sector index breakdown: multi-family residential (57.9), institutional (52.7), mixed practice (51.0), commercial / industrial (50.3)
- Project inquiries index: 58.6
- Design contracts index: 49.7
The
regional and sector categories are calculated as a 3-month moving average,
whereas the national index, design contracts and inquiries are monthly numbers.
About the AIA Architecture Billings Index
The
Architecture Billings Index (ABI), produced by the AIA Economics & Market Research Group, is a
leading economic indicator that provides an approximately nine to twelve month
glimpse into the future of nonresidential construction spending activity. The
diffusion indexes contained in the full report are derived from a monthly
“Work-on-the-Boards” survey that is 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. These monthly results are also
seasonally adjusted to allow for comparison to prior months. The monthly ABI
index scores are centered around 50, with scores above 50 indicating an
aggregate increase in billings, and scores below 50 indicating a decline. The
regional and sector data are formulated using a three-month moving average.
More information on the ABI and the analysis of its relationship to
construction activity can be found in the recently released White Paper,
Designing the Construction Future: Reviewing the Performance and Extending the
Applications of the AIA’s Architecture Billings Index on the AIA web site.
About The American Institute of Architects
Founded
in 1857, the American Institute of Architects consistently works to create more
valuable, healthy, secure, and sustainable buildings, neighborhoods, and
communities. Through nearly 300 state and local chapters, the AIA advocates for
public policies that promote economic vitality and public wellbeing. Members
adhere to a code of ethics and conduct to ensure the highest professional
standards. The AIA provides members with tools and resources to assist them in
their careers and business as well as engaging civic and government leaders and
the public to find solutions to pressing issues facing our communities,
institutions, nation and world. Visit www.aia.org.
Source: AIA
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