ABI Shows Strongest Reading in Five Years
The AIA reported an increase in the Architecture Billings Index (ABI) score for January. A score of 54.2 reflects fast growth from December’s score of 51.2. In addition, there is strong growth in the new projects inquiry index, resulting in a reading of 63.2. This is up from last month’s new project inquiries index of 57.9.
Kermit Baker, the AIA’s Chief Economist, commented that “a continued reservation by lending institutions to supply financing for construction projects is preventing a more widespread recovery in the industry,” but that Continue reading »
AIA Architecture Billings Index Remains Negative in July
The Architecture Billings Index (ABI) by the American Institute of Architects (AIA) maintained a negative score for the month of July, though the rate of decline was not as significant as the months of May and June. The July ABI score was 48.7 which is an improvement when compared to June’s score of 45.9. Based on comments by AIA Chief Economist Kermit Baker, it appears that improvements in construction industry spending will correlate with the improvement of overall economic conditions. The new projects inquiry index increased from 54.4 in June to 56.3 in July. Read the AIA’s full ABI press release here.
Mixed Signals in Recent Economic Indicators Causing More Anxiety for the Construction Industry
Have you had a chance to read any economic news lately, and how it may impact your Construction Company? Chances are there may be a feeling of increased anxiety and uncertainty. (Hasn’t this been the generally feeling for the past 3 years anyway though?) Here is a brief summary of what is causing this renewed feeling of anxiety:
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Is the economy getting better or are workers leaving the industry?
Construction Spending Unexpectedly Increases In August
The roller coaster ride of 2011 continues for the construction industry. Following a 1.1% decrease in July, construction spending saw an unexpected increase in the month of August for nonresidential construction spending of 1.6% compared to the previous month. This is based on the U.S. Census Bureau’s press release. McGraw Hill Construction also reported an 8% increase in construction spending starts versus a 10% decline in July in their most recent report.
The good news was also seen in the employment spectrum according to The Associated General Contractors of America (AGC). AGC stated in their press release that construction employers added 26,000 jobs during the months of August and September. This increase brought the current unemployment level for the industry to 13.3% but AGC cautioned that some of the recent declines in the unemployment rate were a result of construction workers leaving the industry all together.
Based on the statistics that have been released over the past 3 months it is hard to gauge whether the industry has begun to stabilize or not. These mixed economic signals may be frustrating for contractors attempting to prepare budgets or who are considering hiring additional employees for the future. Continue reading »
Construction Spending Decreases in July
So far 2011 has been a rollercoaster year for the Construction Industry as a whole. Most recently the industry saw a spending increase in June to hit a 6-month high, only to see the most recent economic data suggest a sizable decrease in spending in July. According to McGraw-Hill Construction, there was a 10% decrease in July construction starts compared to a 15% gain in June as revealed in their article. Contradictory to this, The Associated Builders and Contractors (ABC) released their Construction Backlog Indicator which appeared to present improved data in that backlog had increased 10% in the 2nd Quarter of 2011. Continue reading »
AIA does not Project Nonresidential Construction Growth Until 2012
In an article recently released by the American Institute of Architects (AIA), it was found by the AIA Consensus Construction Forecast panel that nonresidential construction spending will decrease by 5.6% during 2011 followed by a recovery of 6.4% in 2012. These findings come despite recent good economic reports for the industry where June construction starts increased 15%, according to an article from McGraw-Hill Construction, and July construction employment reaching a 15 month high as provided by a press release from The Associated General Contractors of America. Continue reading »
Construction Spending Decreases in May
On the heels of bad news released by the American Institute of Architects (AIA) earlier this month indicting the possibility of future decreases in construction spending, the U.S. Department of Commerce has released construction data for the month of May which reflected a decrease in construction spending. Read the article here as provided by the Associated Press.
