August continued the prolonged stretch of declining architecture billings at architecture firms, marking the 19th consecutive month of decline. The American Institute of Architects/Deltek reported an Architecture Billings Index score of 45.7, a decrease of July's score of 48.2, indicating an accelerated pace of decline; any score below 50.0 indicates decreasing business conditions. While all regions and sectors reported soft business conditions, an upward tick in new project inquiries continued.
Key takeaways
- Billings remain weakest at firms with a multifamily residential specialization.
- Three-quarters of firm leaders are at least somewhat confident that business conditions will improve over the next 12–18 months.
The report also keeps tabs on new project inquiries, which didn't change from July to August, with a score of 52.4.
In addition to regional averages, the Architecture Billings Index also regularly reports on the rate and improvement of billings by project type. In August all sectors reported declines in billings, with practices working on a mix of typologies reporting the lowest drop in billings.
"Unfortunately, even the impending interest rate cuts didn't move the needle on project inquiries or new design contracts at architecture firms," says AIA chief economist Kermit Baker. "Hopefully, once the trajectory of further cuts gets clarified, delayed projects will restart, and new projects will gather momentum."
