Demand Softening Based on Flat/Declining Billings

Demand for design services at architecture firms decreased in June in comparison to the previous month, according to a new report today from the AIA. AIA’s ABI score for June was 49.1, which is down from 50.2 in May. Any score above 50 indicates an increase in billings. Both the project inquiries index and the design contracts index continued to soften in June but remained positive.

“With billings declining or flat for the last five months, it appears that we are settling in for a period of soft demand for design services,” said AIA Chief Economist Kermit Baker, PhD, Hon. AIA. “With the new design contracts score reaching a 33-month low and the project inquiries score hitting a 10-year low, work in the pipeline may start to get worked off, despite current robust backlogs.”

Key ABI highlights for June include:

Regional averages: South (51.9); West (49.3); Midwest (48.9); Northeast (46.1)
Sector index breakdown: mixed practice (54.3); commercial/industrial (52.3); institutional (47.0); multi-family residential (46.3)
Project inquiries index: 52.8
Design contracts index: 50.3

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