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ABI Turns Positive after Four Straight Monthly Declines

Written by Heidi Schwartz. Posted in Interiors, Professional Development

Tagged: , , ,

Published on September 21, 2011 with No Comments

On the heels of a period of weakness in design activity, the Architecture Billings Index (ABI) took a sudden upturn in August. As a leading economic indicator of construction activity, the ABI reflects the approximate nine to 12 month lag time between architecture billings and construction spending.

The American Institute of Architects (AIA) reported the August ABI score was 51.4, following a very weak score of 45.1 in July. This score reflects an increase in demand for design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 56.9, up sharply from a reading of 53.7 the previous month.

“Based on the poor economic conditions over the last several months, this turnaround in demand for design services is a surprise,” said AIA Chief Economist, Kermit Baker, PhD, Hon. AIA. “Many firms are still struggling, and continue to report that clients are having difficulty getting financing for viable projects, but it’s possible we’ve reached the bottom of the down cycle.”

Key August ABI highlights:

  • Regional averages: Midwest (49.0), South (47.4), West (47.4), Northeast (46.5);
  • Sector index breakdown: mixed practice (50.9), institutional (48.5), commercial/industrial (46.0); and
  • Project inquiries index: 56.9

The monthly ABI index scores are centered around 50, with scores above 50 indicating an aggregate increase in billings, and scores below 50 indicating a decline. The regional and sector data are formulated using a three-month moving average.

About Heidi Schwartz

Heidi Schwartz

Schwartz joined Group C Media in April 1989 as managing editor of Today's Facility Manager (TFM) magazine (formerly Business Interiors) where she was subsequently promoted to editor/co-publisher of the monthly trade magazine for facility management professionals. In September 2012, she took over the newly created position of internet director for TFM's parent company, Group C Media, where she is charged with developing content and creating online strategies for TFM and its sister publication, Business Facilities. Schwartz can be reached at schwartz@groupc.com.

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