It's been a while since I've last blogged on the state of the construction economy. For a short period of time, I thought the summer was ironically signalling a cool down in the market given that the Census Bureau reported that construction spending was down in June, both for private and public construction. But last week, negativity shifted to optimism when the American Institute of Architects released their July Architectural Billing Index (ABI), which revealed billings are up to its highest level since 2007 (pre great recession levels). July's ABI was 55.8, up significantly from 53.5 in June (any value greater than 50 means that architecture billings are increasing; conversely, any value less than 50 means billings are decreasing; the ABI is a leading indicator of commercial building construction by approximately nine to 12 months). The details are as follows:
Regional (three month moving) Averages for July 2014:
It's important to note that the regional reports do not always signal widespread distributed increases/decreases throughout the region. For example, the coastal cities in the west (San Francisco, for example) remain strong, while the cities farther inland (Sacramento, Las Vegas, etc.) are relatively weak.
Sector Averages for July 2014:
Project inquiries are up to 66.0, astonishing given the figures over the past few years. A new measure, Design Contracts Index (which I'll admit I need to learn more about) is at 54.9.
All in all, very strong data that hopefully signifies that we're heading into a stable period of continued growth in the construction industry.