The American Institute of Architects’ monthly Architecture Billings Index (ABI) for March 2012 was 50.4, down slightly from 51.0 in February, making it the fifth straight month that the index has shown improving business conditions for architecture firms. (This also represents the sixth time that the score came in over the crucial 50 number in the past 12 months—the AIA says that the index reflects a roughly nine- to 12-month look ahead at the state of construction spending.)
November 2010 to March 2011 also had a string of five straight months with the index in positive territory. In April 2011, it dipped back into negative territory for the first of four months, a move concurrent with nationwide fears of a double-dip recession that never quite materialized. The nation will have to wait a month to see whether that dipping trend repeats itself or if the market continues to get stronger this year. AIA chief economist Kermit Baker, in the AIA’s press release, expressed caution but confidence, as he hears “more about improving conditions in the marketplace, with a greater sense of optimism that there will be greater demand for design services.”
The new-projects-inquiries index, another potential leading indicator for the design and construction industries, came in at 56.6. This was substantially lower than the 63.4 recorded last month, but still in positive territory for the 38th straight month. (The last time the project inquiries recorded a score less than 50 was January 2009.)
In regional news, the story line from last month continues. The scores for three of the four regions of the U.S. were above 50, the same regions as the previous two months. (These are the Northeast, Midwest, and South regions. The West region is still scoring in the mid-40s, and the last time that the West region had a score 50 or above was September 2007.) As for the industry sectors, commercial is leading the others with a score of 56. Multifamily residential and institutional each took a slight dip this month, and the score for mixed practice went up slightly, albeit still coming in at less than 50. See the past six months for the regional and sector indexes in the charts below.
Score by region:
Midwest: 54.1
Northeast: 53.9
South: 50.1
West: 46.6
Score by sector:
Commercial/industrial: 56.0
Multifamily residential: 51.9
Institutional: 47.7
Mixed practice: 47.2
The regional and sector categories are calculated as a three-month moving average, whereas the index and inquiries are monthly numbers.
