Architecture firm billings continue to tighten into 2025

Architecture firms reported another decline in billings in January as the AIA/Deltek Architecture Billings Index (ABI) was 45.6*. Any score below 50.0 indicates decreasing business conditions.

While most architecture firms saw billings decline in January, the proportion experiencing a decrease was slightly lower than in December. Inquiries for new projects continued to rise at a steady, slow pace, but the value of newly signed design contracts dropped for the eleventh month in a row, as clients stayed cautious amid ongoing economic uncertainty.

“Stubborn inflation, persistently high interest rates, and labor concerns continue to weigh on the willingness of owners and developers to move ahead with construction projects,” said AIA Chief Economist, Kermit Baker, Hon. AIA, PhD. “Architecture firms have been moving to right-size their operations in response to softer market conditions. There was a net loss of 1,400 positions at architecture firms nationally in 2024, and firm employment has declined by a total of 4,100 positions since the post-pandemic peak in June 2023.”

Billings were soft across all regions and specializations in January. Firms with a commercial/industrial focus reported the most significant decline in business conditions, but weakness was observed across all sectors. Business conditions remained weakest in the Northeast, continuing a trend from recent months.

Key ABI highlights for January include:
•    Regional averages: West (48.8); South (46.0); Midwest (45.6); Northeast (41.1)
•    Sector index breakdown: institutional (47.4); multifamily residential (45.0); mixed practice (firms that do not have at least half of their billings in any one other category) (44.3); commercial/industrial (43.1)
•    Project inquiries index: 51.4
•    Design contracts index: 46.2

The regional and sector categories are calculated as three-month moving averages and may not always average out to the national score.

*Every January the AIA research department updates the seasonal factors used to calculate the ABI, resulting in a revision of recent ABI values.

Visit AIA’s website for detailed information about this, and past billing index reports.

About AIA
Founded in 1857, AIA consistently works to create more valuable, healthy, secure, and sustainable buildings, neighborhoods, and communities. Through more than 200 international, state, and local chapters, AIA advocates for public policies that promote economic vitality and public well-being.

AIA provides members with tools and resources to assist them in their careers and business as well as engaging civic and government leaders and the public to find solutions to pressing issues facing our communities, institutions, nation, and world. Members adhere to a code of ethics and conduct to ensure the highest professional standards.

About Deltek
Better software means better projects. Deltek is the leading global provider of enterprise software and information solutions for project-based businesses and the home of AIA MasterSpec®. More than 30,000 organizations, including 12,000 Architecture & Engineering firms, rely on Deltek for superior levels of project intelligence, management, and collaboration. Our industry-focused expertise powers project success for A&E firms of all sizes by helping them achieve performance that maximizes productivity and revenue. Learn more at Deltek.