After starting off 2015 in negative territory, the Architecture Billings Index (ABI), released today by the AIA, reflects overall growth in design services for the past two months. The March ABI score was 51.7, up from February's mark of 50.4 and January's 49.9. Any score above 50 indicates an increase in billings, whereas a score below 50 means a contraction.
Other national economic indicators looked positive, including the new project inquiries score, which rose from 56.6 in February to 58.2 in March, and the design contracts index, which increased from 50.0 in February to 52.3 in March.
In a breakdown of geographic regions, the highest levels of demand continue to remain in the South, and the lowest in the Northeast. "Business conditions at architecture firms generally are quite healthy across the country. However, billings at firms in the Northeast were set back with the severe weather conditions, and this weakness is apparent in the March figures," said AIA chief economist Kermit Baker, Hon. AIA, in a press release.
As for industry sectors, the "multi-family residential market has seen its first occurrence of back-to-back negative months for the first time since 2011, while the institutional and commercial sectors are both on solid footing," Baker said in the press release.
Here are the national, regional, and sector breakdowns for the March ABI report.
National Billings: In its second month of growth, the March score was 51.7, up from February’s mark of 50.4.
Project inquiries: After falling to the lowest score since July 2012 in February (56.6), the value in this category rose to 58.2 last month.
Design contracts: Following February's 50.0, the lowest score in 11 months, the value for design contracts also increased to 52.3 in March.
Northeast: In its seventh consecutive month of contractions, the Northeast suffered a decrease in index value from February's 46.6 to March's 45.8, the lowest score in 14 months.
Midwest: March’s mark of 51.0 is a marginal increase from February's 50.8, indicating 11 months of consecutive growth.
South: Nearing its second year of consistent monthly growth, the South received the highest regional score for the third consecutive month. March's score of 54.5 is up from February's 53.7.
West: The West dug itself out of a two-month slump, rising from negative scores in January (49.1) and February (48.6) to rise to 50.4 in March.
Multifamily Residential: At 49.7, this sector is experiencing its second straight month in the red.
Commercial/Industrial: This sector declined slightly, with March’s score of 53.0 rising above February's mark of 51.2.
Institutional: At 53.2, institutional projects saw the highest demand last month.
Mixed Practice: In its fifth consecutive month of contractions, this sector continues to have the lowest score among the sectors, at 46.2.
Charts: Maggie Goldstone
Source: AIA Architecture Billings Index
Update: The AIA also released its economic update for Q2 of 2015. ARCHITECT editor-in-chief Ned Cramer and AIA chief economist Kermit Baker discuss the factors affecting the construction industry.