The American Institute of Architects monthly Architecture Billings Index came in at 47.5 in December, a 0.9-point rise from November's score of 46.6. 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.

The scores for project inquiries and design contracts improved marginally. New project inquiries came in at 52.3, rising 0.3 point from November's score of 52.0. Design contracts remained negative this month with a score of 49.4, up 2.5 points from November's score of 46.9.

“Despite strong revenue growth last year, architecture firms have modest expectations regarding business conditions this coming year,” said AIA chief economist, Kermit Baker, Hon. AIA, in a press release from the organization. “With ABI scores for the entire fourth quarter of 2022 in negative territory, a slowdown in construction activity is expected later this year, though the depth of the downturn remains unclear.”

The month-to-month changes in scores for regional billings—which, unlike the national score, are calculated as three-month moving averages—gained slight ground in December, however, all four scores fell below 50.0. Billings in the Midwest increased 1.8 points to a score of 49.4 , while billings in the West declined 0.3 point to a score of 45.5. Billings in the South fell 1.9 points to a score of 48.6, and billings in the Northeast rose 4.1 points to a score of 46.5.

As in November, only one of December's sector billings scores remained above 50.0. Two of the four scores increased slightly. The commercial/industrial sector increased 1.0 point to a score of 45.2; the institutional sector fell 0.4 point to a score of 47.3. The multifamily residential score decreased 1.8 points to a score of 44.3, and the mixed practice sector rose 3.3 points to a score of 54.8. Like the regional billings scores, sector billings scores are also calculated as three-month moving averages.

Read more business news: Billings Slow Again in November | Moderated September billings reflect pressures in housing market