As a leading economic indicator of construction activity, the ABI shows an approximate nine to twelve month lag time between architecture billings and construction spending. The American Institute of Architects (AIA) reported the December ABI rating was 55.4, up a fraction from the 55.3 mark in November (any score above 50 indicates an increase in billings), and inquiries for new projects was 58.1.
The stretch of 34 straight months with a positive score is the longest run in the history of the survey that began in 1995, eclipsing the positive scores that continued from April 1998 to December 2000.
“As the country braces for a possible recession in 2008, there will likely be an easing in demand for design services.” said AIA Chief Economist Kermit Baker, PhD, Hon. AIA. “While that is a natural reaction, it is important to note that with positive conditions for architecture billings going back over two years nonresidential construction is expected to one of the sources of strength in an otherwise uneven economy.”
Key December ABI highlights:
• Regional averages: Northeast (63.6), South (57.1), Midwest (51.5), West (51.3)
• Sector index breakdown: commercial / industrial (62.1), mixed practice (58.7), institutional (53.8), multi-family residential (46.2)
• Billings inquiries index: 58.1