Architectural Billings Index: Firms Remain Hesitant to Start Projects

According to the latest Architecture Billings Index (ABI) data, September marked the twentieth consecutive month of declining billings for architecture firms. The American Institute of Architects reports an ABI score of 45.7, which indicates that most firms have continued to experience a decline in billings.

The ABI score is an economic indicator of construction activity, providing an approximately nine-to-12-month glimpse into the future of nonresidential construction spending activity. The score is derived from a monthly survey of architecture firms that measures the change in the number of services provided to clients.

“Despite recent rate cuts by the Federal Reserve, many clients remain on the sidelines about proceeding on planned projects,” says chief economist Kermit Baker. “And while new project opportunities also emerge, clients are cautious about which to pursue. Fortunately, architecture firms report backlogs of 6.4 months on average, which remain above pre-pandemic levels and indicate that there is existing work in the pipeline.”

Key September ABI Highlights

• Regional averages: South (49.5); Northeast (46.4); Midwest (45.0); West (42.6)

• Sector index breakdown: institutional (48.5); mixed practice (firms that do not have at least half of their billings in any one other category) (47.8); commercial/industrial (44.2); multifamily residential (41.7)

• Project inquiries index: 51.6

• Design contracts index: 48.3