The architecture industry is recovering, index shows

A leading economic indicator of the architecture and construction industries has shown a pattern of rising demand for design services. What areas are more likely to flourish?
Written by Reena Jana, Contributor

It's obviously no secret that the architecture and construction sectors have been hit hard by the recent economic crisis. Still, as SmartPlanet has analyzed in the past, there's been evidence mounting that suggests a potential and enduring upswing--see C.C. Sullivan's "2012 forecasts: Architects (and allies) see recovery." And this week, the American Institute of Architects announced that its Architectural Billings Index (ABI) has shown three months of consecutive upturns. The ABI reflects the current economic state of the construction industry and is based on a national survey that tracks the demand for design services among member firms of the AIA.

“Even though we had a similar upturn in design billings in late 2010 and early 2011, this recent showing is encouraging because it is being reflected across most regions of the country and across the major construction sectors,” said AIA Chief Economist Kermit Baker in a statement issued on February 22.

What areas show the most promise, based on data gathered for the last three months? Geographically, the Midwest, South, and Northeast all saw an increase in billings in that time period, although the West did not.

Nationwide, firms that focus on multi-family residential projects; commercial/industrial buildings; and institutional architecture all saw more demand--and ranked in that descending order for the most billings in the last three months. Architects who have mixed-practice firms did not see an upturn in business in that time frame.

The project inquiries index hit a score of 61.2 in January, notable as any time an ABI score hits 50, it indicates growth. While metric that seems encouraging, the AIA cautions that the recovery will likely not be dramatic, at least in the immediate future.

“Because we still continue to hear about struggling firms and some continued uncertainty in the market, we expect overall economic improvements in the design and construction sector to be modest in the coming months,” AIA economist Baker said.

Related on SmartPlanet:

2012 Forecasts: Architects and allies see recovery

Report details economic impact of stalled architecture projects

Demand for design services on the upswing, new survey shows

Image: Sea Turtle/Flickr

This post was originally published on Smartplanet.com

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