T
he latest Architecture Billings Index (ABI) from AIA/Deltek reveals a continued decline in billings for architecture firms nationwide. February's score of 45.5 indicates that most firms are struggling financially, with all regions experiencing weak billings. This downturn is compounded by a significant drop in inquiries for new projects, which has not been seen since the pandemic in 2020. New signed design contracts have fallen for the twelfth consecutive month as clients remain hesitant to commit due to economic uncertainty.

    AIA Chief Economist Kermit Baker notes that while the broader economy showed positive signs in February, including modest Consumer Price Index increases and a strong job market, the architecture sector faces unique challenges. The recent announcement of tariffs and potential rise in building material costs are concerning, particularly with an already strained construction labor market.

    Regional performance varies, with the West leading at 48.1, followed by the South (47.6), Midwest (45.2), and Northeast (41.3). Sector-wise, commercial and industrial sectors scored 46.9, while multifamily residential projects came in at 46.1. Mixed-practice firms recorded a lower score of 42.1.

    The ABI data suggests that challenges are widespread across regions and firm types, pointing to difficulties in the architecture and construction industries. As firms await signs of recovery, they remain cautious in navigating economic fluctuations, regulatory changes, and shifting market conditions.