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04.14.2010
Midwest Motors On
Billings show unexpected strength in region

Architects have had an especially difficult time during the recession, but recently there are some bright spots out there for the profession, perhaps none more so than in the Midwest region, which according to the AIA Architecture Billings Index shows the strongest signs of leading a recovery for the industry in the country. Midwest firms have posted improving billings for nine consecutive months—the only region to do so—and are currently the closest to reaching positive territory.

In February, Midwest firms recorded billings of 49.4, an increase of 1.4 points from January and a marked improvement from 37.2 last May, when the Midwest was the worst-performing of the four regions tracked by the AIA. By comparison, the national billings index has been far more uneven, rising to 44.8 in February from 42.5 in January and 45.4 in December, continuing a trend of instability in the mid-40s stretching back to last summer. (A reading above 50 means billings are rising, below means they are falling.)

“Regionally, I would have guessed the South would have carried us out of the recession, with its oil and agricultural commodities,” said AIA Chief Economist Kermit Baker. By his assessment, the key to the Midwest’s success has been a surprising improvement in manufacturing, the region’s economic heart. “People are increasingly looking domestically for such work,” Baker said, and exports are also on the rise. This does not mean architects are building new factories—according to the AIA, the commercial/industrial sector is the worst right now, at 43.2—but it is bringing an infusion of much-needed resources that is creating other opportunities in the region.

Walter Street III, president of the AIA Chicago chapter, believes it is the region’s economic diversity that has helped it weather the storm. “The Midwest tends to be a more conservative business environment,” he said. “All segments of the economy have gone down the toilet at the same time. That said, our diversity has allowed us to be more flexible and adapt to those who are doing well.”

Some, however, continue to struggle. “Times aren’t good here,” said Rae Dumke, executive director of AIA Detroit. “Michigan has probably been the hardest hit of any architects in the country. That said, even we’re seeing work pick up, though it’s mostly out-of-town or on hold because the banks won’t lend.”

While signs are pointing upward for Midwest firms, hiring remains tentative, when it is taking place. “Since August, around Chicago, there’s been a gradual movement upwards in hiring,” Street said. “That said, it’s a different kind of hiring, very strategic, very surgical.”

Matt Chaban