Architectural Billings Index: May’s 2023 national Architectural Billings Index of 51.0 was up 2.5 points from April’s 48.5, which is above the expansionary zone, (>50). U.S. architecture firms specializing in multifamily residential and Institutional all reported a decrease in design activity in May.

The design contracts sub-index increased by 2.5 points to 52.3. Regional monthly scores were – South: 52.3, West: 47.7, Midwest: 49.6, and Northeast 48.7.

The Architectural Billings Index (ABI) is a leading economic indicator that provides an approximately nine to 12-month glimpse into the future of nonresidential construction spending activity. The results are seasonally adjusted to allow for comparison to prior months. Scores above 50 indicate an aggregate increase in billings, and scores below 50 indicate a decline.

Figure 1 lists the overall ABI and its sub-indexes. It presents and compares monthly and 3MMA data, showing percentage point change on both a three and 12-month basis, as well as momentum. Green denotes positive change, while red indicates negative. National momentum, (3-month y/y minus 12-month y/y) was down 2.9% while design contract momentum decreased 2.0%. Regionally, all posted a negative momentum, ranging from 0% in the South to 8.3% in the West. Institutional and Multi-Family Residential facilities also posted a negative momentum.

At Gerdau, we follow the ABI because it is a leading indicator of non-residential construction activity with an approximate nine to 12-month lead time to groundbreaking. The ABI has a proven track record and, as such, it is useful for business planning purposes.