Three is the magic number for the Architectural Billings Index, it seems, as April marks a hat-trick of consecutive positive scores.
The three-month long positive streak will be welcome news, but not all within the industry will be surprised that April reported a positive score of 50.9 as the construction season approaches its zenith. This score, however, was down from March’s 54.3. Meanwhile, Design Contracts and Inquiries were both up from the previous month, rising to 53.2 and 60.2 from 52.3 and 59.8 respectively.
If last year is anything to go by, we can expect three more months of positive scores.
The ABI is the leading economic indicator of construction activity. It reflects a 9 to 12 month lead time between architecture billings and construction spending. The national index, design contracts, and inquiries are calculated monthly, while the regional and sector categories are calculated as a three-month moving average. The index runs on a scale from 0-100 and scores above 50 suggest growth while anything below implies negativity in the market.
“Probably even better news for the construction outlook is that new project work coming into architecture firms has seen exceptionally strong growth so far this year,” said AIA Chief Economist, Kermit Baker, Hon. AIA, PhD in a press release. “In fact, new project activity has pushed up project backlogs at architecture firms to their highest level since the design market began its recovery earlier this decade.”
Key April ABI highlights:
• Regional averages: South (55.3), Midwest (53.3), West (50.9), Northeast (50.7)
• Sector index breakdown: institutional (54.0), mixed practice (53.4), commercial / industrial (52.4), multi-family residential (49.9)
• Project inquiries index: 60.2
• Design contracts index: 53.2