WASHINGTON, DC-The American Institute of Architects reports that its leading economic indicator, the Architecture Billings Index, has posted its fourth straight month of growth, leading AIA chief economist Kermit Baker to cautiously declare the industry in recovery. “Normally, four months would be a convincing track record for indicating an upturn,” he tells GlobeSt.com. “However, I am a little gun-shy because we went through the same episode last year and nothing materialized.”
The February ABI score was 51.0, following a mark of 50.9 in January. This score reflects a slight increase in demand for design services. The new projects inquiry index was 63.4, up from mark of 61.2 the previous month and its highest reading since July 2007.
There are a number of reasons why Baker feels 2012 is different from the false start in 2011. “There is a more general sense of optimism, other economic indicators are also trending positively and there is a richer base of people who agree the economy has turned the corner," he says.
Regional averages in the February score include a 56 for the Midwest, 51.3 for the South, the Northeast posted a 51.0, and the West, 45.6. The sectors broke down along the following lines: 55.1 for commercial/industrial, 53.3 for multifamily, institutional posted a 50.3 and mixed practice, a 46. A leading economic indicator of construction activity, the ABI reflects the approximate nine to twelve month lag time between architecture billings and construction spending.
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