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Electrical Marketing's Leading Economic Indicators - March 25, 2022 Update

March 24, 2022
Indicators still generally positive, but some concerns seeping in over inflation and higher interest rates.

February building permits cool off but still sit well above 2021 levels

Privately‐owned housing units authorized by building permits in February were at a seasonally adjusted annual rate of 1,859,000, -1.9% below the revised January rate of 1,895,000, but +7.7% above the Feb. 2021 rate of 1,726,000. According to the U.S. Census Bureau, single‐family authorizations in February were at a rate of 1,207,000, -0.5% below the revised January figure of 1,213,000.

AIA’s Billings Index stays solid in February

Demand for design services in February grew slightly since January, according to the Architecture Billings Index (ABI) published monthly by the American Institute of Architects (AIA).

The ABI score for February was 51.3 points, up from a score of 51 points in January. Any score above 50 points indicates an increase in billings. Firms reported both project inquiries and design contracts remaining positive in February, but while project inquiries increased to 62.5 points from 61.9 points in January, design contracts decreased to 55.2 points from 56.1 points.

“Despite the continued healthy demand for design services, activity is plateauing as firms face a myriad of external challenges, from staffing to supply chain disruptions to high inflation and rising interest rates,” said Kermit Baker, AIA chief economist, in the press release. “While the rebound from the pandemic has positively impacted firms in most regions, the prolonged lack of demand for design services in the Northeast is of growing concern.”

Railroads not carrying as much freight in early March

Freight rail traffic slowed down in the week ending March 12, according to the Association of American Railroads (AAR). For this week, total U.S. weekly rail traffic was 496,134 carloads and intermodal units, down -4.7% compared with the same week last year. For the first 10 weeks of 2022, U.S. railroads reported cumulative volume of 2,288,852 carloads, up +3.2% from the same point last year; and 2,561,813 intermodal units, down -7.2% from last year. Total combined U.S. traffic for the first 10 weeks of 2022 was 4,850,665 carloads and intermodal units, a decrease of -2.6% compared to last year.