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Architectural Firms See Glimmers of Business Hope in AIA Billings Index

March 22, 2024
in Business
Architectural Firms See Glimmers of Business Hope in AIA Billings Index
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AIABillingsFeb2024.jpg

Graphic Courtesy American Institute of Architects/Deltek

Billings for architectural firms continued downward in February, according to the latest American Institute of Architects/Deltek monthly index. But the report’s authors see possible silver linings in the index, released March 20. 

They note that the billings decline is the smallest since July 2023, which the authors say “suggests that the recent slowdown may be receding.”

The latest monthly AIA/Deltek index, for February, shows a billings score of 49.5, compared with 46.2 for January and 45.4 in December. The report also says the score for design contracts is 51.1, compared with 49.7 in the previous month.

Kermit Baker, AIA’s chief economist, said in a statement, “There are indicators this month that business conditions at firms may finally begin to pick up in the coming months.”

Baker added, “Inquiries into new projects grew at their fastest pace since November, and the value of newly signed design contracts increased at their fastest pace since last summer.”

He said, “Given the moderation of inflation for construction costs and prospects for lower interest rates in the coming months, there are positive signs for future growth.”

Looking at market sectors, firms with a concentration in institutional projects reported increased business, with a score of 50.7; those in the commercial/industrial segment had a score of 46.1; and firms in the residential sector recorded the lowest score, with 44.9. 

The scores reflect the period from February 2023 to February 2024.

A look at regional results shows that firms in the Midwest reported a modest year-over-year gain, with a February 2024 score of 50.8.

The report says that Midwest firms reported increased business in the past thee months and in four of the last five months.

A score of more than 50 represents an increase in billings; a score below 50 indicates decreased business and a score of 50 means no change.

According to the report, the index is viewed as a leading economic indicator, providing an early signal of nonresidential construction activity in the next nine to 12 months. 

Tom ichniowski

Tom Ichniowski has been writing about the federal government as ENR’s Washington Bureau Chief since the George H.W. Bush administration, and he has covered at least five major highway bills. A recognized expert on government policy on infrastructure and regulation, Tom is also a Baltimore native and Orioles fan who grew up rooting for Brooks and Frank Robinson. He is a graduate of Columbia College and Columbia’s graduate school of journalism, where he once used “unrelentless” in a headline.

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Copyright for syndicated content belongs to the linked Source : Enr.com – https://www.enr.com/articles/58360-architectural-firms-see-glimmers-of-business-hope-in-aia-billings-index

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