AIA's Architecture Billings Survey Sees Mixed Results for August

Washington, DC – In August, architecture firms continued to face soft business conditions, posting an AIA/Deltek Architecture Billings Index® (ABI) score of 47.2. Although the share of firms reporting declining billings eased slightly from July's 46.6 number, the overall trend remained downward.

Inquiries into new projects showed only modest growth this month, while the value of newly signed design contracts continued to decline. Despite an overall decline in billings, regional performance was mixed in August. Midwest firms reported modest growth for the first time in nearly a year, and billings at Western firms were essentially flat. In contrast, Northeast firms saw billings fall sharply to their lowest level since 2020. Architecture firms are growing less optimistic about future billings, with the share expecting declines rising from 21 percent at the end of the first quarter to 29 percent by the end of the third quarter.

Conditions in the broader economy also remained mixed in August. Architectural services employment increased, adding 700 new positions in July. Despite this employment growth, inflation ticked back up in August, with the Consumer Price Index (CPI) increasing by 0.4 percent from July, after rising just 0.1 percent the previous month. It remains up by 3.4 percent from one year ago, with recent increases in gasoline and energy prices among the largest contributors.

“Architecture firms are caught between stubborn inflation and higher borrowing costs,” said AIA Chief Economist Richard Branch. “The Federal Reserve’s latest rate increase may help ease inflationary pressures over time, but in the near term it adds another headwind for projects already facing a difficult financing environment.”

Key ABI highlights for August include:

•    Regional averages: Midwest (50.7); West (49.8); South (46.1); Northeast (40.7)
•    Sector index breakdown: commercial/industrial (50.4); multifamily residential (47.8); institutional (47.0); mixed practice (firms that do not have at least half of their billings in any one other category) (42.5)
•    Project inquiries index: 50.8
•    Design contracts index: 48.3

The regional and sector categories are calculated as three-month moving averages and may not always average out to the national score.

About The American Institute Of Architects

For over 150 years, members of the American Institute of Architects have worked with each other and their communities to create more valuable, healthy, secure, and sustainable buildings and cityscapes. Members adhere to a code of ethics and professional conduct to ensure the highest standards in professional practice. Embracing their responsibility to serve society, AIA members engage civic and government leaders and the public in helping find needed solutions to pressing issues facing our communities, institutions, nation and world. For more information, visit www.aia.org.