Archinect - Features

Architecture Business Metrics Begin To Turn Positive: Archinect’s State of AEC November 2024

2024-12-02T13:55:00-05:00

Welcome to the sixth installment of Archinect's series, State of AEC. At the end of each month, we will guide you through the latest analyses, indexes, and trends on how the architecture and construction industries are performing economically.

Throughout the past month, several key indicators related to architectural business have either stabilized or turned positive, counteracting a year of largely negative numbers. The AIA's Architecture Billings Index marginally turned positive for the first time in almost two years, while billings also increased in firms located in the South region and in firms specializing in institutional projects. For some commentators, such numbers are the early shoots of a more positive economic landscape expected in 2025.

Read our full roundup of the month's economic and business figures below and find out more about how the business health of the architecture profession is faring via our recently released survey results here.

When Should Architecture Firms Start Hiring? Five Factors To Consider

2024-11-14T13:46:00-05:00

With the U.S. Federal Reserve embarking on rounds of target interest rate cuts in late 2024, AEC industry commentators are forecasting that architectural business conditions may improve in the coming months. Architecture firms experiencing an increased workload may, therefore, find themselves asking the deceptively simple question: When should I start hiring?

Should hiring decisions be made in response to secure work or more speculative projections? Should onboarding time be taken into account? Are there economic considerations beyond workload projects that should be factored in?

In search of answers, Archinect spoke with four firms about their hiring strategies: Fogarty Finger, FXCollaborative, Marmol Radziner, and Marvel. From our conversations, five key factors emerged for firms to consider when designing their own hiring strategies.

Interest Rates Were Cut, but Growth Takes Time: Archinect’s State of AEC October 2024

2024-11-05T08:00:00-05:00

Welcome to the fifth installment of Archinect's new series, State of AEC. At the end of each month, we will guide you through the latest analyses, indexes, and trends on how the architecture and construction industries are performing economically.

Throughout the last month, commentators in the architecture and planning spheres have noted that, although interest rates were cut in September, clients remain cautious about commissioning architects for new projects or committing projects to planning. For one commentator, the industry may not feel the full positive impact of the rate cuts until the middle of 2025, which may lead to strong nonresidential planning performance.

10 Tips for Architects To Survive Downturns by Former HOK CEO Patrick MacLeamy

2024-10-18T13:55:00-04:00

“I spent 50 years at HOK, working my way up from junior designer to CEO,” Patrick MacLeamy wrote in his 2020 book Designing a World-Class Architecture Firm: The People, Stories, and Strategies Behind HOK. “Where else can you do that?”

During his time as HOK CEO and Chairman from 2003 to 2016, MacLeamy exerted great effort in shaping a resilient practice that, in many ways, harks back to the ethos of the firm’s founding. As a child of the Great Depression, co-founder George Hellmuth purposely structured HOK along the principles of what he described in 1944 as a 'Depression-Proof Firm,' one that could step off the typical economic rollercoaster that many firms, then and now, continue to ride.

Eight decades later, MacLeamy believes the industry has much to learn from the approach taken by Hellmuth, along with his co-founders Gyo Obata and George Kassabaum. “Architecture is a passion, not just a profession, and my own passion for the field extends to the business side,” MacLeamy writes...

The Industry Reacts to Interest Rate Cuts: Archinect’s State of AEC September 2024

2024-10-08T08:39:00-04:00

Welcome to the fourth installment of Archinect's new series, State of AEC. At the end of each month, we will guide you through the latest analyses, indexes, and trends on how the architecture and construction industries are performing economically.

Since our last edition, the U.S. Federal Reserve announced its first interest cut in four years, lowering its rate by half a percentage point. In previous editions of this series, we noted that many commentators had expressed hope that such a move would begin to reverse the fortunes of firms that, as can be seen in the data published below, continue to see declining billings. As we noted in a recent feature published after the rate cut, history tells us the move will indeed have a positive impact on architectural business conditions, though it may be several months before such an impact is felt.

Read our full roundup of the month's economic and business figures below and find out more about how the business health of the architecture prof...

Delivering Projects on Time Is a Challenge. Here’s How Architects Do It

2024-09-30T14:35:00-04:00

U.S. President Dwight D. Eisenhower once said, “plans are nothing; planning is everything.” This sentiment rings true in architecture, where architects are required to establish project timelines potentially spanning several years for schemes potentially costing millions of dollars. No matter how robust the timeline is at the beginning of the project, however, unforeseen circumstances often threaten to derail our best-laid plans.

To explore how architects can effectively design project timelines, as well as adhere to plans and respond to disruption, we speak with both Assembledge+ founder and principal David Thompson and EC3 founder Edwin Chan for their tips and perspectives.

The Fed Just Cut Interest Rates. What Does It Mean for Architects?

2024-09-27T08:13:00-04:00

In September 2024, the U.S. Federal Reserve cut the target range of interest rates for the first time in four years. The move was long anticipated by AEC commentators, who hoped that the lower cost of borrowing would begin to pull the sector out of a two-year stagnation in business conditions.

We explore what the interest rate cut means in the context of 2024’s architectural business conditions with input from Phillip Ross, partner at the AEC division of financial firm Anchin.

Architecture's Interest Rate Prayers Answered: Archinect’s State of AEC August 2024

2024-09-04T08:00:00-04:00

Welcome to the third installment of Archinect's new series, State of AEC. At the end of each month, we will guide you through the latest analyses, indexes, and trends on how the architecture and construction industries are performing economically.

In our previous edition of the series, we noted the almost unanimous hope expressed by commentators across the AEC industry that the U.S. Federal Reserve would announce interest rate cuts in the coming months, which may propel growth in design studios and construction sites alike. In August, those prayers were answered by the Fed's confirmation that rates would be cut from September onwards.

While the industry waits to see what impact such cuts will have, divergent trends among architecture and construction business activity continue. While billings and design contracts in architecture firms continue to decrease, construction starts rose 10%, and both apartment and hotel construction activity sits at record highs.

Read our full roundup of ...

Many Architecture Firms Don’t Know How To Pursue International Work; We Spoke With Some That Do

2024-08-29T09:07:00-04:00

Over the past year, the number of U.S. architecture firms working on international projects has gently increased. However, a recent AIA survey found that many firms do not know how to pursue international work. In search of insights and advice on the topic, we spoke with three practices who have won acclaim for projects far beyond their base of operations: Safdie Architects, Steven Holl Architects, and Mecanoo.

The Pandemic Is History, but for Architects, Its Impact on Office Design Remains

2024-08-21T08:45:00-04:00

Our recent analysis of the Archinect Business Survey highlighted concerns among architects that their business health has been impacted by the ongoing adoption of remote and hybrid working patterns across the U.S. in the wake of the COVID-19 pandemic. We explore in more detail how the supply and demand of workplace real estate has changed in recent years, where it is heading, and what opportunities and challenges it presents for architects.

Are Architectural Workers More Pessimistic About the Economy Than Firm Owners?

2024-08-19T08:00:00-04:00

In our recent analysis of the Archinect Business Survey published last month, we observed a distinct divergence between how firm owners and workers were feeling about the business health of their firm, industry, and the wider U.S. economy. Across the board, our survey suggests that firm workers felt more pessimistic and insecure about today’s economic landscape than firm owners. Why?

There is likely no ‘one size fits all’ answer to this question. However, a number of trends playing out across the economy, including architecture-specific trends previously reported by Archinect, offer several lines of speculation.

An Industry Pins Its Hopes on Interest Rate Cuts: Archinect’s State of AEC July 2024

2024-08-08T13:49:00-04:00

Welcome to the second installment of Archinect's new series, State of AEC. At the end of each month, we will guide you through the latest analyses, indexes, and trends on how the architecture and construction industries are performing economically.

As we reflect back on June and July 2024, we see continued declines in billings among architecture firms, in addition to a decrease in new on-site construction activity. Commentators on the business health of the industry are almost unanimous in voicing hopes that interest rate cuts, rumored to be announced by the Federal Reserve next month, may propel growth in design studios and construction sites alike.

Read our full roundup of the month's economic and business figures below, and find out more about how the business health of the architecture profession is faring via our recently-released survey results here.

Five Big Factors Behind the Architecture Industry’s Economic Slowdown

2024-07-05T12:59:00-04:00

Earlier this week, we released Part One of our findings from the Archinect Business Survey, which invited you to share how you were feeling about the economic outlook of your firm and sector. Our analysis found that across the United States, architects have seen business conditions decline in the past year and are downbeat about their firm’s business health, the health of the architecture industry at large, and the wider U.S. economy. Meanwhile, clients are cautious about starting or continuing projects.

While Part One offered an insight into how architects and clients are faring within the architecture industry’s current economic slowdown, this article, Part Two, explores the potential causes of the slowdown itself. The five factors set out below reflect what respondents to our survey, and economists and commentators from within and beyond the architecture industry, have identified as driving forces behind today’s business climate.

While each of these factors deserves to be isolate...

Architects and Clients Downbeat About Economy: Archinect's Business Survey Results Revealed

2024-07-03T08:29:00-04:00

Throughout May and June 2024, we invited our community to offer us insights and feedback on how you were feeling about the economic outlook of your firm and sector. As we explained at the time, this project was motivated by several observations from economists within and beyond the AEC industry that the U.S. may be “sleepwalking” into a recession.

To investigate how the architecture profession was fairing against such headwinds, we asked you a series of questions on the economic health of your firm, your sentiments on the wider sector, your experience of the job market, your conversations with clients, your plans for the future, and more.

Having analyzed your feedback, Archinect can now reveal our findings, which will be published in two parts. Part One, below, offers an overview of how both architects and clients are feeling about the industry, in addition to how they are responding to the challenges they are facing. Part Two sets out some of the key factors and driving forces behi...

Debates Surrounding Architectural Competitions Are Nothing New

2024-06-13T12:10:00-04:00

In the US architectural profession of the 2020s, and newfound scrutiny over workplace conditions from unpaid overtime to a poor work-life balance, architecture competitions have become the subject of debate over how the profession values itself and is valued by wider society while also ensuring public-funded projects are not exploited as avenues of cronyism. However, a reading of the past 100 years of the profession tells us that we have been here before.

How the Business of Architecture and Construction Fared in May 2024: Introducing Archinect's State of AEC Series

2024-06-03T12:13:00-04:00

Welcome to the first of Archinect's new monthly series, 'State of AEC.' At the end of each month, we will guide you through the latest analyses, indexes, and trends on how the architecture and construction industries are performing economically.

As we approach the midway point of 2024, data on the economic performance of the AEC sector suggests a subtle divergence between design and construction services. While the AIA's Architecture Billings Index shows a nine-month-long decline in billings within U.S. firms, construction starts are on the rise, albeit hampered by minor decreases in construction spending and increases in construction costs.

What unites all sides of the industry, however, are concerns over interest rates. While some held out hope that interest rates may fall from their 5.5% level at the beginning of May, no such fall materialized. As a result, analysts in the architecture and project planning sector note that clients have become hesitant to commit to new design proj...

How to Understand Architecture Business Conditions Using the AIA's Architecture Billings Index

2024-05-20T08:23:00-04:00

Since 1995, the American Institute of Architects has conducted a monthly index detailing trends in billings by architecture firms in the United States. Over time, the Architecture Billings Index (ABI) has become a valuable metric for charting the economic health of the profession, with Archinect reporting on the index monthly since 2012.

To help readers better understand how metrics from ABI translate into the reality of design and construction and to equip them with the tools to interpret the numbers, understand their source, and delineate between various categories, we have assembled a series of questions and answers pertaining to the index.

Architects, How Is Work Feeling These Days?

2024-05-16T10:45:00-04:00

We want to hear from our community: How are you feeling about the economic outlook of your firm and sector? How easy or difficult are you finding it to secure projects? What is your employment outlook? What are you hearing from clients?

Fill out our anonymous survey below.

'AI Is Both Incredible and Terrifying'; A Conversation with Neil Leach

2023-06-19T11:00:00-04:00

Neil Leach is a British professor and licensed architect currently based in California. He has worked for NASA developing a 3D printer for the Moon and Mars, and is co-founder of DigitalFUTURES. Having authored over 40 books on architecture and digital design, and taught at some of the world's leading architecture schools, including the AA, Harvard, SCI-Arc, and Columbia, his in-depth understanding of architecture's professional and academic landscapes allows him to speculate how artificial intelligence will impact the future of design.

For Leach, conversations limited to popular AI tools such as Midjourney and ChatGPT detract from a broader reckoning that the architecture profession must have in the face of ever-more-capable AI models and platforms. This AI-induced reckoning includes, though is not limited to, the supply and demand of architectural labor, liabilities, and insurance, and the future of all pillars of the architectural community, be it practice, academia, or licensure...

Architecture’s 'State of the Union': Reflections on the 2022 World Architecture Festival

2023-01-05T06:00:00-05:00

From November 30th through December 2nd, 2022, the World Architecture Festival (WAF) held its first physical event in three years. The annual festival, adapting to an online format during the COVID-19 pandemic, is regarded as one of the most critical events in the global architectural calendar, from identifying award-winning projects from over 700 candidates around the world to facilitating debates, discussions, and critiques on the built environment, and the forces entwined within it. Below, Archinect’s Niall Patrick Walsh reflects back on his visit to the 2022 edition of the festival, held in Lisbon, Portugal.

The Pandemic Exposed Deep Flaws in the Architecture Profession — But Also Inspired Remedies

2022-08-25T11:26:00-04:00

Two and a half years after the initial outbreak of COVID-19, the U.S. architectural profession has emerged from the global pandemic in a stronger condition than many could have expected during the depths of 2020. However, many questions remain unanswered on how the pandemic impacted the architectural job market, firm operations, and the design process; questions which deserve scrutiny in the interests of avoiding future economic pain, and building a more resilient profession. In search of answers, we speak to three firms in differing parts of the U.S. to hear their reflections on how the profession fared during the pandemic, and where it goes next. To understand how these unique experiences fit within a national picture, we also speak with AIA Chief Economist Kermit Baker, who reflects on a deeper supply-demand issue across the profession.

How the Pandemic Is Impacting Architectural Photography

2020-05-06T12:14:00-04:00

While most of the professional and academic architecture world managed to, more or less, cope with the new reality of the pandemic by transitioning to remote work, some specialized roles in the industry intrinsically rely on the physical interaction with space in its unique location.

To find out how architectural photographers around the world have kept up so far with the sudden limitations to business, we have reached out to a number of photographers previously featured in Archinect's popular In Focus series.

We asked them how architecture had been impacted in their region, if social distancing was even possible during shoots, and how they planned on operating now with numerous new safety measures in place.

CONTOURS: The Divisions that Bind Us

2012-01-16T20:28:00-05:00

As if the narratives and infographics of Occupy weren’t loud enough by now, Catherine Rampell, an economics reporter for The New York Times, decided to bang the drum a little louder by writing “Want a Job? Go to College, and Don’t Major in Architecture”.

CONTOURS: Immigration and the Economy

2011-12-12T13:44:43-05:00

Listening to the Republican presidential debates, one would think that immigration is the single most important issue pressing on the U.S. economy today and that if it were “solved”—i.e. no immigrants of color (especially those from Mexico in particular, though those from Arab nations, China, and South Asia generally are also targeted by this discourse) were ever let across our borders again—that the economic woes would also be solved. In architecture, the presence of East Asian nationals in particular causes consternation amongst certain circles.

CONTOURS: EDD DE 1101 I - Part 2

2011-12-05T13:07:50-05:00

There are so many metaphors for being unemployed. My preference is a burial scenario. You are being buried and the earth keeps getting piled upon you deeper and deeper until you eventually stop trying to dig your way out. It becomes your early grave. Might as well just stay in there. When the economy eventually does improve, 43% of those 13.9 million long-term unemployed Americans may very likely remain buried as the new sidewalks of hope are poured right over them. The new armies with stars and dollar signs in their eyes will blindly stagger along going in and out of gold-plated doors, making their way around the Monopoly board until the next recession—roughly every ten years.

CONTOURS: EDD DE 1101 I

2011-11-28T12:45:19-05:00

Author’s Disclaimer

Hello! Author here. Just interjecting at the onset of this article to make it clear that, yes, I am indeed biased and this is not intended to be purely objective in any sense. I’m also blatantly stealing this device from David Foster Wallace, who used this little tactic in his posthumous novel, The Pale King. Have you read it? Quite good, I think, as long as you can get beyond the fact that he hanged himself. That’s depressing. Another subjective P.O.V. on my part. Sorry.

CONTOURS: Get a Job!

2011-11-21T12:39:20-05:00

Disconnects. There are disconnects. You become aware of them when you pass from one reality into another. From employed to unemployed is one such transition. It’s hard to understand unless you have gone through it. I would compare the experience to going to war…without all the weapons and death.

CONTOURS: What Should Architecture Occupy? Part Three

2011-11-14T12:53:28-05:00

The results of the OWS poll are in. Now, there are many different approaches to summarizing the responses. One is to rely solely on statistics, but since many of the answers cannot be meaningfully summarized this way, and since OWS itself is about giving people a voice, the best way to encapsulate the results is to quote some responses. Of course, the flip responses were jettisoned because what we wanted were sincere, thoughtful responses, whether we agreed with them or not.

CONTOURS: What Should Architecture Occupy? Part Two

2011-11-07T12:00:00-05:00

Of course, we know why architects are quiet on these fundamental issues of wealth and inequality. On the one hand they are just too busy trying to run their businesses and chase after ever fewer projects for less and less money. The other reason is that architects depend on the wealthiest segments of society for their livelihoods. Thus it seems to provide an obvious reason not to support a movement that stands for social and economic justice and an end to rules that favor corporations, banks and wealthy individuals over “everyone else.” Again, if you aren’t sure what the ruckus is all about, you can do some investigating on your own—start by reading outside the architectural press.

CONTOURS: What Should Architecture Occupy? Part One

2011-10-31T12:00:00-04:00

Unless you’ve been living under a very remote rock, you know by now that the OWS, or Occupy Wall Street movement, with its many offshoots including Occupy the Hood, has been continued for over a month, now. And what’s more, unless you are independently wealthy or a trustfund baby (and are therefore the “1%”), you are also part of the 99% of the population whom this collective movement addresses.