AIA's monthly Architecture Billings Index (ABI) for June came in at a score of 49.1. This is a 1.1-point decrease from last month's score of 50.2, marking a contraction in demand for design services. 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.
“With billings declining or flat for the last five months, it appears that we are settling in for a period of soft demand for design services,” says AIA chief economist Kermit Baker, Hon. AIA, in a press release. “With the new design contracts score reaching a 10-month low and the project inquiries score hitting a 10-year low, work in the pipeline may start to get worked off, despite current robust backlogs.” In June, design contracts posted a score of 50.3, a 0.6-point decrease from May's score of 50.9.
The scores for regional billings—which, unlike the national score, are calculated as three-month moving averages—fell in three of the four regions in June, with only one region posting a score above the threshold of 50. The billings score for that region, the South, did rise 0.5 points to a score of 51.9. Meanwhile, design services in the Northeast decreased by 1.4 points to a score of 46.1. In the West, demand fell 0.7 points to a score of 49.3 and in the Midwest by 2.7 points to score of 48.9.
Billings scores also fell in three of the four individual industry sectors. The institutional sector's score decreased by 1 point to a score of 47.0, the commercial/industrial sector score fell by 0.7 points to 52.3, and the the mixed practice sector decreased by 1.1 points to a total of 54.3. The multifamily residential score increased by 0.3 points to 46.3. (Like the regional billings, sector billings scores are also calculated as three-month moving averages.)
This story has been updated since its original publication.