AIA’s monthly Architecture Billings Index took another hit in December, posting a score of 42.6, down 3.7 points from November's score of 46.3. The ABI is a leading economic indicator of construction activity in the U.S. and reflects a nine- to 12-month lead time between architecture billings and construction spending nationally, regionally, and by project type. A score above 50 represents an increase in billings from the previous month, while a score below 50 represents a contraction.
“Since the national economic recovery appears to have stalled, architecture firms are entering 2021 facing a continued sluggish design market,” said AIA chief economist Kermit Baker, Hon. AIA, in the Institute's press release. “However, the recently passed federal stimulus funding should help shore up the economy in the short-term, and hopefully by later this year there should be relief as COVID vaccinations become more widespread. Recent project inquiries from prospective and former clients have been positive, suggesting that new work may begin picking up as we move into the spring and summer months.” New project inquires remained flat from November to December at a score of 52.4. Design contracts remained in negative territory, dropping 0.1 point to a score of 48.6.
The month-to-month change in scores for regional billings—which, unlike the national score, are calculated as three-month moving averages—largely dipped in December, with all four regions again reporting scores well below the threshold of 50. Billings in the Midwest dropped 6.5 points to a score of 43.6, while billings in the West decreased 4.9 points to a score of 43.4. Billings in the South rose 0.1 point to a score of 46.8, and billings in the Northeast also rose 0.1 point to a score of 38.8.
Billings score fell in each individual industry sector with all four sectors reporting scores below the threshold of 50.0. The commercial/industrial sector decreased 0.3 point to a score of 47.2; the institutional sector dropped 3.4 points to a score of 38.5. The multifamily residential score dropped 6.1 points to a score of 46.1; the mixed practice sector fell 1.5 points to a score of 48.0. Like the regional billings scores, sector billings scores are also calculated as three-month moving averages.
