Architectural firms across the country are seeing an increase in business prospects this spring, raising hopes that the industry’s steady climb out of a pandemic economy is continuing.
According to the latest Architecture Billings Index released by the American Institute of Architects, overall billings in the industry as of the end of May stood at 51.0, with readings above 50 indicating an increase in billings.
That figure is up from the 48.5 reported in April. More promising: inquiries from clients regarding new projects saw an increase from 53.9 in April to 57.2 in May.
Equally hopeful: the value of new design contracts went from 49.8 in April to 52.3 in May.
The index is done in conjunction with the Herndon, Virginia-based software company Deltek.
In a statement, Kermit Baker, the American Institute of Architects’ chief economist, described the May figures as encouraging. But he added: “There continues to be variation in the performance of firms by regional location and building specialization. This suggests that overall business conditions for the profession likely will continue to be variable.”
Regionally, the South in May was leading the way with a billing index performance of 52.3, followed by the Midwest at 49.6, the Northeast at 48.7, and the West at 47.7.
The AIA billing index has been plodding in recent months. In December it stood at 47.5, a figure that had only increased to 48.0 in February.
The index appeared to crash in the spring of 2020 during the weeks of the country’s Covid 19 outbreak, dropping in March of that year to 33.3, and an all-time low of 29.4 the following month.
That April 2020 figure represented the largest single month decline in the 25-year history of the billings index.
The industry, however, saw some resilience as the year progressed. By December, the index stood at 42.3. A rush of new business in 2021 during a time when the pandemic appeared to be abating, brought the index up to 52 by the end of that year.
Always responding to trends, the architecture industry attributed some of its 2021 and 2022 comeback to new pandemic-related work among both healthcare and education clients.
In late 2022 the Los Angeles Business Journal noted that such institutions “had to retool their heating/ventilation/air conditioning systems to improve air circulation and reduce the risk of the spread” of the virus.
By Garry Boulard
