Architecture Billings Index Hits Rare Two-Month Downturn

For the first time in four years, the Architecture Billings Index (ABI) posted consecutive months of a decline in demand for design services.

As a leading economic indicator of construction activity, the ABI reflects the approximate nine-to-12-month lead time between architecture billings and construction spending.

The American Institute of Architects (AIA) reported the September ABI score was 48.4, down from the mark of 49.7 in the previous month. This reflects a decrease in design services, as any score above 50 indicates an increase in billings. The new projects inquiry index was 59.4, down from a reading of 61.8 the previous month.

“This recent backslide should act as a warning signal,” says AIA chief economist Dr. Kermit Baker. “But this drop-off in demand could be continued hesitancy in the marketplace to move forward on projects until the presidential election is decided. The fact that new work coming into architecture continues to slowly increase suggests that billings will resume their growth in the coming months.”

Regional ABI averages were: South (53.4), Midwest (50.1), West (49.5) and Northeast (44.0).

Index by sector broke down as follows: commercial/industrial (50.4), mixed practice (49.8), institutional (49.0), and multifamily residential (48.8).