In a concerning trend for the architecture industry, the AIA/Deltek Architecture Billings Index (ABI) recorded a decline in firm billings for February, marking a score of 45.5. This indicates that a majority of architectural firms are facing reduced billings, continuing a trend of financial difficulty within the sector.
February also marked the first time since the height of the COVID-19 pandemic in 2020 that there has been a drop in inquiries for new projects, which are usually a reliable indicator of future work opportunities, even in times of economic slowdowns. Furthermore, the signing of new design contracts has fallen for the twelfth consecutive month, showing ongoing reluctance from clients to commit to new projects amidst the prevailing economic uncertainty.
AIA Chief Economist Kermit Baker, Hon. AIA, PhD, highlighted the mixed economic signals affecting the industry. “Conditions in the broader economy were generally positive in February, with the Consumer Price Index (CPI) increasing by only a modest amount, long-term interest rates easing from January levels, and healthy job growth,” he explained. “However, uncertainty surrounding the impact of recently announced tariffs may lead to a rise in building material prices in the coming months while immigration policy may put even more pressure on an already undersupplied construction labor market.”
The ABI report also provided detailed regional and sector data:
- Regional averages were led by the West at 48.1, followed by the South at 47.6, the Midwest at 45.2, and the Northeast at a low of 41.3.
- By sector, commercial/industrial billings were at 46.9, institutional at 46.4, multifamily residential at 46.1, and mixed practice at 42.1.
Both the project inquiries index and the design contracts index reflected the downturn, registering at 47.8 and 42.0 respectively.
The indexes for regional and sector categories are calculated as three-month moving averages, which provides a more stable view but does not necessarily align perfectly with the national score.
For more detailed insights and historical data on billing indices, stakeholders are encouraged to visit the AIA’s official website.
