AIA: Invoices expand in August

The American Institute of Architects’ monthly Architecture Billings Index came in at 53.3, up 2.3 points from July’s score of 51.0. The ABI is a leading economic indicator of construction activity in the US and reflects a nine to twelve month lead time between architecture invoices and construction expenditures by national, regional and project type. A score above 50 represents an increase in billing from the previous month, while a score below 50 represents a contraction.

“The ABI is still in expansion territory, indicating that investment in non-residential businesses is still making progress, albeit at a lower level than at the start of the year,” said Ali Wolf, the chief economist of parent company’s parent company. ARCHITECT, Zonda. “Given the slowing trends in the broader economy, we’re tracking how long this indicator stays above 50, the key level to track for market health.”

The number of applications for new projects increased in August as design contracts weakened. New project applications scored 57.9, down 1.8 points from July’s score of 56.1. Draft contracts came in at 52.3, down 0.6 points from July’s score of 52.9. “While a stronger billing score is encouraging, the flat score across regions and sectors points to a nationwide slowdown in the coming months,” said AIA chief economist Kermit Baker, Hon. AIA. “A variety of economic storm clouds continue to pack, but as design activity continues to ramp up, we can expect at least another nine to 12 months of run-in before construction activity is negatively impacted.”

Monthly changes in regional bill scores — which, unlike the national score, are calculated as three-month moving averages — moderated again in August. Three of the four regional scores lost ground and one score remained below 50.0. Billing in the Midwest fell 0.8 points to a score of 51.4, while billing in the West fell 1.5 points to a score of 50.2. Billing in the South fell 0.7 points to a score of 52.9, and bills in the Northeast rose 1.4 points to a score of 49.8.

All four industry invoice scores in August remained above 50.0, with one score increasing slightly from July. The commercial/industrial sector fell 1.0 point to a score of 51.2; the institutional sector rose by 2.4 points to a score of 52.0. The multi-family home score decreased by 0.8 points to a score of 52.0 and the mixed practice decreased by 0.9 points to a score of 51.2. Like regional billing scores, sector billing scores are also calculated as three-month rolling averages.

Read more business news: July invoices show slowest growth since January | Shepley Bulfinch CEOs Past and Present Discuss Design Leadership in Challenging Times

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