As a leading economic indicator of construction activity, the ABI reflects the approximate nine to 12 month lag time between architecture billings and construction spending. A score under 50 indicates a continued decline in demand for design services.
A regional breakdown of the ABI, according to the report, which was authored by AIA chief economist Kermit Baker showed the south faring better than the rest of the region with a score of 46.4. In the Northeast, it was 45, Midwest (43.7) and West (41.1). The sector index broke down as follows: institutional (47), multi-family residential (45.8), mixed practice (42.8), commercial/industrial (40.7). The project inquiries index was 58.5.
The recent modest rises in the index came during a very volatile period, an AIA spokesman tells GlobeSt.com. "So while there have been periods of ups and downs the overall index has been in negative territory for some time."
The AIA is hopeful it will rise again. GSA still has $2 billion of spending from the stimulus bill to allocate, which it must do by the end of the year, he says. "Also the president has specifically called on institutions to start lending particularly to small businesses." Most architecture firms are small businesses, he notes.
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