Big boost in building permits. The Department of Commerce reported that privately-owned housing units authorized by building permits in March were at a seasonally adjusted annual rate of 594,000, 11.2 percent above the revised February rate of 534,000, but 13.3 percent below the March 2010 estimate of 685,000. Single-family authorizations in March were at a rate of 405,000; 5.7 percent above the revised February figure of 383,000.
March AIA Billings Index holding steady. The American Institute of Architects (AIA), Washington, D.C., reported the March ABI score was 50.5 points, a negligible decrease from a reading of 50.6 points the previous month. The new projects inquiry index was 58.7 points, up significantly from a mark of 56.4 points in February. This score reflects a modest increase in demand for design services (any score above 50 points indicates an increase in billings). As a leading economic indicator of construction activity, the ABI reflects the approximate nine- to twelve-month lag time between architecture billings and construction spending.
“The range of conditions reported continues to span a very wide spectrum with some firms reporting an improving business environment and even ramping up staffing, while others continue to operate in survival mode,” said AIA Chief Economist, Kermit Baker. “The catalyst for a more robust recovery is likely financing, with stronger growth occurring only when lending institutions begin approving credit for construction projects with much greater regularity.”
Purchasing Managers Index (PMI) decreases in March but still on solid ground. With a March reading of 61.2 points, 0.2 points off February, the PMI published monthly by the Institute for Supply Management, Tempe, Ariz., still points toward solid conditions in the industrial market. Commodity prices remain a concern, said Norbert Ore, chair of ISM’s Manufacturing Business Survey Committee. “While manufacturers are benefiting from strength in new orders and production, there is significant concern with regard to commodity prices,” he said. “Many manufacturers indicate the prices they have to pay for inputs are rising, and there is concern about the impact of higher prices on their margins.”