According to a new report set to be released by the American Institute of Architects (AIA) measuring recent economic activity in the architecture sector, the demand for design services has fallen to a new low this summer.
The AIA's Architecture Billings Index for the month of August, for example, shows a "significant drop in architecture firm billings compared to the July score," according to AIA chief economist Kermit Baker. In a summary of the report, Baker writes,"“The sizeable drop in both design billings and new project activity, coming on the heels of six months of disappointing growth in billings, suggests that the design expansion that began in mid-2012 is beginning to face headwinds.”
The drop adds to recent softening in billings and new contracts figures for architecture firms. Until the latest batch of numbers, architecture billings and contracts had remained slightly positive for the year, with strong regional demand in the American south and west regions picking up slack for the slightly more sluggish eastern and midwestern regions. But as of August, demand has fallen across the board such that three of the four regions are now showing a decrease in billings while one, the west, is just barely growing.
Summarizing these figures, Baker writes, “Currently, the weakness is centered at firms specializing in commercial/industrial facilities as well as those located in the Midwest. However, there are fewer pockets of strength in design activity now, either by building sector or region than there have been in recent years.”
Modest strength can be found in institutional projects and multi-family residential work; The figures also show that project inquiries are up. The number of new contracts being signed, however, is falling.
3 Comments
Just a reflection of the economy or are more and more developers just designing in-house? Or is it part of something more sinister and macro... AI??? :)
long-term projects (architecture) are the leading economic indicator
they've been pumping for 11 years, we're overdue for the dump. lot's of money to be made shorting historic highs. also crashing the economy is an effective way to undermine Trump's reelection campaign. thus his desperation to have the FED drop interest rates (as if this going to stop the crash ...)
the only question is what will happen when they bail out the banksters again?
Get your Starbucks applications ready, kiddies.
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