AIA: We may not have reached the bottom of this construction downturn
After showing signs of stabilization over the last three months, the Architecture Billings Index plunged nearly five points in June, according to a July 22 release from the American Institute of Architects, Washington, D.C. 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. AIA officials reported the June ABI rating was 37.7, far lower than the 42.9 the previous month, according to the release. This score indicates a sharp decline in demand for design services (any score above 50 indicates an increase in billings). The new projects inquiry score was 53.8, the fourth straight month with a score in the mid-50’s, the release stated.
“It appears as though we may have not yet reached the bottom of this construction downturn,” said AIA Chief Economist Kermit Baker, in the release. “Architecture firms are struggling and concerned that construction market conditions will not even improve as soon as next year. There has also been little movement in terms of stimulus funding allocated for design projects having the desired impact of leading to new work.”