US July architectural index rises, but activity is still shrinking

22 August 2012 22:38  [Source: ICIS news]

HOUSTON (ICIS)--An index of future construction activity in the US increased by 6% for July, but the increase was not enough to indicate that design activity was expanding, the American Institute of Architects (AIA) said on Wednesday.

The AIA’s Architecture Billings Index (ABI) was 48.7, up nearly 3 points from June’s score of 45.9. The May ABI was 45.8, AIA officials said.

However, only a score above 50 indicates an increase in architectural design billings.

One year ago, the ABI score was 45.1, having dropped for five consecutive months amid concerns that the economy had not yet bottomed out.

“Even though [architectural] billings nationally were down again in July, the downturn moderated substantially,” AIA chief economist Kermit Baker said. “As long as overall economic conditions continue to show improvement, modest declines should shift … to growth in design activity over the coming months.”

The ABI results reflect a lag of 9-12 months between architecture billings and construction spending, according to the AIA.

The project-inquiries index for July increased to 56.3, up by more than 2 points over June’s 54.0.

The construction sectors experienced increases of 1.3-6.9%, with the strongest gain in the mixed practice sector.

The AIA survey showed weaker July results in the midwest and the northeast and increases in the west and the south, the latter of which saw a leading nearly 11% increase in design services.

Every $1,000 spent on non-residential construction generates $160-230 (€128-184) worth of consumable chemicals and derivatives, according to the American Chemistry Council.

($1 = €0.80)

By: Larry Terry
1 713 525 2653

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