Building permits hammered in April. Privately-owned housing units authorized by building permits in April were at a seasonally adjusted annual rate of 1,074,000, -20.8% below the revised March rate of 1,356,000 and -19.2% below the April 2019 rate of 1,330,000. According to the U.S. Census Bureau, single-family authorizations in April were at a rate of 669,000, -24.3% below the revised March figure of 884,000.
Architecture Billing Index bottoms out in April. Demand for design services in April saw its steepest decline ever, according to the April report from the American Institute of Architects (AIA). AIA’s Architecture Billings Index (ABI) score of 29.5 points for April reflects a decrease in design services from architects. During April, both the new project inquiries and design contracts scores also declined significantly, posting scores of 28.4 points and 27.6 points respectively. Any number below 50 points indicates a decrease in billings. The ABI is a closely watch leading economic indicator in the construction industry because architects see interest in new projects several months earlier than contractors, distributors, reps and others in the supply chain.
“With the dramatic deceleration that we have seen in the economy since mid-March, it’s not surprising that businesses and households are waiting for signs of stability before proceeding with new facilities,” said AIA Chief Economist Kermit Baker, in the press release. “Once business activity resumes, demand for design services should pick up fairly quickly. Unfortunately, the precipitous drop in demand for design services will have lasting consequences for some firms.”
ISM’s Purchasing Managers Index sees big dip in April. The April Purchasing Managers Index registered 41.5%, down -7.6 percentage points from the March reading of 49.1%. Any reading below 50% in the monthly survey of industrial purchasing managers by the Institute for Supply Management points to a contracting industrial economic climate.
Freight rail traffic remains soft in early May. The Association of American Railroads (AAR) reported that total carloads for the week ending May 9 were 185,144 carloads, down -28.4% compared with the same week in 2019.