After two years of consistently increasing demand for design services, the Architecture Billings Index (ABI) dipped into contraction territory in March, according to a report from The American Institute of Architects (AIA).
The ABI score for March was 47.8, down from 50.3 in February, falling below the 50-point threshold into contraction territory for the first time in 25 months. AIA said indicators of work in the pipeline, including inquiries into new projects and the value of new design contracts remained positive.
“Though billings haven’t contracted in a while, it is important to note that it does follow on the heels of a particularly tough late winter period for much of the country,” said AIA Chief Economist Kermit Baker. “Many indicators of future work at firms still remain positive, although the pace of growth of design contracts has slowed in recent months.“
By region, design firms in the South didn’t share in the contraction in March, posting an index of 54.2, but the other regional averages were all below 50: Midwest 48.7, West 47.2, Northeast 43.5. By sector, mixed-practice firms were at 53.1, commercial/industrial at 47.0, institutional at 48.9 and multi-family residential at 47.7. The regional and sector indices are calculated as 3-month moving averages whereas the national index, design contracts and inquiries are monthly numbers.