The AIA's monthly Architecture Billings Index (ABI) came in at a score of 50.4 in October, a 0.7-point decline from September's reading of 51.1. 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, as seen in October, represents an increase in billings from the previous month, while a score below 50 represents a contraction.
“The effects of the 2018 hurricane season are the probable cause of the temporary contraction in billings in the Southern region,” said AIA chief economist Kermit Baker, Hon. AIA, in a press release. “This decrease in demand for design services is limited, and the region should rebound over the next several months.”
In October, design contracts posted a score of 52.8—a 1.3-point decrease from September's score of 54.1, demonstrating that momentum has slowed, likely due to the natural disasters.
The scores for regional billings—which, unlike the national score, are calculated as a three-month moving averages—fell in three regions in October, with two regions falling below the 50-point threshold. The billings score for the West and the South dropped significantly last month— to scores of 46.4 and 48.4, respectively. Demand for design services decreased by 1.9 points to a score of 57.8 in the Midwest. After last month's contraction, billings rebounded in the Northeast by 5.2 points, to a score of 51.8.
Billings decreased in all four individual industry sectors in October, but only one posted a score below 50, indicating a decrease in services. The multifamily residential score dropped by 2.6 points to a score of 52.3 and the commercial/industrial sector's score decreased by 1.9 points to a score of 48.9. The institutional sector fell 3.1 points to a score of 52. And the mixed-use sector posted a score of 52.7, a 0.7-point decrease September's score of 53.4. (Results of sectors are also calculated as three-month moving averages.)
This article has been updated since its original publication.