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Architecture Billings Index Drops to its Lowest Level Ever
Inquiries for new projects also drop to historic low
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For Immediate Release |
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Washington, D.C., April 23,
2008 — Emblematic of the various struggling sectors in the overall
economy, the Architecture Billings Index (ABI) dropped two points
in March and fell to its lowest level since the survey’s
inception in 1995. As a leading economic indicator of construction
activity, the ABI shows an approximate nine to twelve month lag
time between architecture billings and construction spending. The
American Institute of Architects (AIA) reported the March ABI
rating dropped to 39.7, following its steep 9-point decline in
February (any score above 50 indicates an increase in billings).
The inquiries for new projects score was 48.0, also the lowest mark
for the survey.
“We’ve seen an 11-point fall-off in the first quarter of
the year and the prognosis for commercial construction later this
year is not favorable at this point,” said AIA Chief Economist
Kermit Baker, PhD, Hon. AIA. “Aside from historically low
project demand, all regions are showing very poor business
conditions. This is not likely to reverse itself anytime
soon.”
Key March ABI highlights:
• Regional averages: South (45.3), Northeast (38.7), West
(38.7), Midwest (36.9)
• Sector index breakdown: institutional (50.8), commercial /
industrial (38.3) multi-family residential (31.7)
• Project inquiries index: 48.0
About the AIA Architecture Billings
Index
The Architecture Billings Index is derived from a monthly
“Work-on-the-Boards” survey and produced by the AIA
Economics & Market Research Group. Based on a comparison of
data compiled since the survey’s inception in 1995 with
figures from the Department of Commerce on Construction Put in
Place, the findings amount to a leading economic
indicator that provides an approximately nine to twelve month
glimpse into the future of nonresidential construction activity.
The diffusion indexes contained in the full report are derived from
a monthly survey sent to a panel of AIA member-owned firms.
Participants are asked whether their billings increased, decreased,
or stayed the same in the month that just ended. According to the
proportion of respondents choosing each option, a score is
generated, which represents an index value for each month.
About The American Institute of
Architects
For over 150 years, members of The American Institute of Architects
have worked with each other and their communities to create more
valuable, healthy, secure, and sustainable buildings and
cityscapes. AIA members have access to the right people, knowledge,
and tools to create better design, and through such resources and
access, they help clients and communities make their visions
real.
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