The AIA’s Architecture Billings Index closed out the year much like how it started off: in decline.
December’s score of 48.5—an improvement from November’s 45.3—indicates fewer firms reported a decline in billings in December than in November. This pattern of slowed and sluggish billings is by no means new: Since October 2022 architecture firms have reported declining billings most months.
The news isn’t all bad. In its report the AIA pointed out that many firms still have robust project backlogs, amid a decline in project inquiries and the value of newly signed design contracts.
“Despite the ongoing decline in billings at most architecture firms, there are a few signs of potential improvement on the horizon,” AIA Chief Economist Kermit Baker said. “The number of inquiries into future project work continues to grow, and Midwest firms saw billings increase for the fourth consecutive month in December.”
As Baker pointed out, in the Midwest the score of 51.7 indicates growth in the region. Other regions across the country fared less well, with the lowest again coming out of the Northeast, 44.2.
This month in its report the AIA looked back at the year of 2025 as a whole. It asked respondent firms about the delay and cancellation of projects this past year.
Per the data collected, 90 percent of firms reported projects “significantly delayed over the past six months,” while 84 percent said they have had projects go “on hold/indefinitely stalled,” and 71 percent have had projects be “canceled/abandoned.”
While startling numbers, the report also noted that firms reported that an average of 70 percent of their recent projects proceeded as normal, on a dollar basis.
A mix of factors were cited for project delays and cancellations, among these client indecision, construction budget, volatile market conditions, financing issues, and hefty contractor bids.
The volatility of the wider economy is bogged down by threats of more tariffs and rising consumer costs. (The Consumer Price Index increased by a total of 2.7 percent for the year.) This assuredly will continue to affect the architecture industry as it enters 2026.
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