The American Institute of Architects released a report on May 20th, 2020, revealing that the demand for design services in the US has touched its steepest lows in the last month. The AIA representatives don’t seem to be surprised with the outcome for April’s billings report, as the radical deceleration in the economy has been putting numerous businesses and industries in a tricky position since mid-March – all due to halts. How steep are the declines in architectural billings and design demand in the US?
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Architecture Billings Index Score Below 30 After April
It is considered by the Architecture Billings Index that any score below the value of 50 is a clear sign of a decrease in billings. The AIA reported a score for the Index for April of 29.5. Moreover, design contracts for April also showcased a decline with a score of 27.6, alongside noted declines in the new project inquiries with a score of 28.4. As the AIA’s Chief Economist, Kermit Baker, claims, the resuming business activity should have consequent positive effects on the demand for design services.
Business Activity Comeback to Revamp the Demand for Design Services
During April, the steepest declines in billings were seen in commercial and industrial construction. Following, declines were noted in residential, mixed practice, multi-family, and institutional construction. Baker noted that the entire economy is going through radical changes and a negative period with the declining business activity. As a consequence, reduced activity across different businesses affected the demand for design services and other services in the sector of construction. With resuming business activity, claims Baker, the demand for design services should recover as well.
Pullbacks and Delays Creating Activity Retreat
According to the Chief economist at the Dodge Data &Analytics, Richard Branch, it is expected to see sharp retreat inactivity due to the pullbacks in new jobs and project delays. The retreat inactivity as Branch claims should take place across all sectors of the construction industry.