The AIA’s Architecture Billings Index (ABI) has again reported a decline in billings, while notably not as steep as March (43.6), April saw a score of 48.3—any number lower than 50 indicates a decline in billings. With interest rates still up, the AIA said “firms may have some more slow months ahead of them.”
“These findings indicate that while there is still caution among clients, there are also positive signs with increasing inquiries into new projects,” added AIA chief economist Kermit Baker. “Continued high interest rates make it difficult for some projects to move forward, but there is ongoing interest in pursuing these projects once conditions improve. In the meantime, design activity is expected to remain sluggish.”
In the monthly report the AIA again noted an uptick in new project inquiries and a drop in the value of design contracts. According to the AIA this signifies that “clients remain hesitant to commit to new work.”
In addition to the national number the ABI also shares regional scores. While across the country billings declined in each region, the steepest declines were reported in the Midwest and South, 44.2 and 44.7, respectively. Also of note is that the West saw its 19th consecutive month of declining billings, reflected in its score for April: 47.8.
As the economy bounced back after the pandemic, firms specializing in commercial and institutional projects saw the greatest gains in billings, while those specializing in multifamily residential continued to report weak conditions. In recent months that trend has no longer been the case, as firms in all specialization types have reported drops in billings. For April the score for commercial/industrial was 47.4 and institutional was 46.1.
In its report the AIA also noted the growth of employment in the construction and architecture industries: Construction jobs flattened in April and the number of architecture positions dipped by 300 in March. The report also shared survey information on firms’ interest in and practice on international projects. Of the responding firms, 9 percent said they currently have billings from international projects, an increase of 1 percent from August 2023. Of the practices that have not worked on a project outside of the U.S. in the last five years, 87 percent responded they have no interest in doing so in the future.
