To close out the year the Architecture Billings Index (ABI) has remained stable…and low. The month of December marks the fifth consecutive month the economic indicator, reported monthly by the AIA, has remained under 50 coming in at a score of 45.4, a negligible improvement from November’s 45.3. Any score above 50 indicates an increase in billings from the previous month.
“Billings at firms declined for eight months of the year, and the last four months saw this overall weakness accelerate,” said Kermit Baker in a statement. “Fortunately, project backlogs at firms eased only slightly through the year despite the overall reported softness in billings.”
Similar to November, despite low billings, firms have again reported an increase in new project inquiries and design contracts, with scores of 53.1 and 50.0, respectively.
In its monthly report the AIA said respondent firms indicated that in the last six months they saw the number of delayed and canceled projects increase—an issue that raises alarms across all regions and building sectors. It added that almost 30 percent of projects “on a dollar basis” have been met by one of these circumstances.
Each month the report breaks down the score regionally. This month the only region to report a score higher than 50 was the Midwest at (50.3) an improvement from November’s 49.0. The last few months have seen the West report the lowest scores; in November it reached 39.5, December saw a noticeable jump for the region to 45.3. The region reporting the lowest score this time around was the South at 43.4.
In addition to regional scores, the AIA also breaks down the score by building sector. In December firms with institutional projects reported the highest billings, 46.5, while the institutional sector remained the highest for much of 2023 began dipping in November.
With 2023 now behind us, it remains to be seen whether the economic conditions may improve in 2024.