Sunday, May 5, 2013
Architectural Billings Index
The March 2013 Architectural Billings Index (ABI) numbers came in above the critical 50.0 number for the 8th month in a row on a national basis (also for the West Region) coming in at 51.9. The West Region reported in at 51.9 while the Northeast, Midwest and South regions reported 54.6, 53.9 and 53.6 respectively. The strongest sector nationally was Multifamily Residential at 56.9 with Commercial reported at 53.5 followed by Mixed Practice (53.3) and Institutional (50.6).
The West region reported 46.6 in 2012 and 47.7 in 2011, so the 51.9 is a nice improvement and as the number is greater than 50.0, indicates architect’s billings are increasing. As I reported a few years ago, the ABI is a leading indicator of construction activity as construction spending generally lags architect’s billings by 9 months to a year. In recent months, we have seen many contractor’s backlogs increase with improving margins. However, we also still see challenging situations as well. That being said it seems like many contractors are finding more opportunities and are posting good results. Those who continue prudent operational/fiscal management, are selective with which jobs to bid and running with lower overhead are poised to take advantage of the improving landscape.