Building permits soar in January.
In contrast to January’s sluggish start for housing starts, building permits in January were at a seasonally adjusted annual rate of 1,881,000, +10.4% above the revised December rate of 1,704,000 and +22.5% above the January 2020 rate of 1,536,000. According to the U.S. Census Bureau, single-family authorizations in January were at a rate of 1,269,000, +3.8% above December.
Architectural billings continue to contract in 2021.
A slight improvement in business conditions has led to fewer architecture firms reporting declining billings, according to the latest report from the American Institute of Architects (AIA). AIA’s Architecture Billings Index (ABI) score for January was 44.9 points compared to 42.3 points in December (any score below 50 indicates a decline in firm billings). Although last month’s score indicates overall revenue at U.S. architecture firms continued to decline from December to January, the pace of decline slowed.
“The broader economy entered a soft spot during the fourth quarter of last year, and business conditions at design firms have reflected this general slowdown,” said AIA Chief Economist, Kermit Baker. “While federal stimulus and the increasing pace of vaccinations may begin to accelerate progress in the coming months, the year has gotten off to a slow start, with architecture firms in all regions of the country and in all specializations reporting continued declines in project billings.”
Conference Board says U.S. economy poised for growth.
The Conference Board Leading Economic Index (LEI) for the U.S. increased +0.5% in January to 110.3 (2016 = 100), following a +0.4% increase in December and a +0.9% increase in November. “While the pace of increase in the U.S. LEI has slowed since mid-2020, January’s gains were broad-based and suggest economic growth should improve gradually over the first half of 2021,” said Ataman Ozyildirim, senior director of economic research at The Conference Board. “As the vaccination campaign against COVID-19 accelerates, labor markets and overall growth are likely to continue improving through the rest of this year as well. The Conference Board now expects the U.S. economy to expand by +4.4% in 2021, after a -3.5% contraction in 2020.”
