Architecture Firms End 2025 With Persistent Weakness

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Decline slows slightly in December, but demand still underperforms

THE MOST RECENT REPORT: January 21, 2026

WASHINGTON – The AIA Architecture Billings Index (ABI) closed out 2025 in negative territory with a December score of 48.5, up from 45.3 in November. Any score below 50 indicates a billings decline, although this month’s score indicates that fewer firms reported a decline in billings in December than in November.

Architecture firm billings declined throughout 2025 and most months since October 2022, with only three exceptions. While fewer firms reported a decrease in December, declining design contract values suggest a near-term rebound is unlikely. However, firm backlogs remain strong, averaging 6.3 months. Large firms with annual billings of $5 million or more report backlogs of 8.6 months, while institutional specialists average 8.2 months. Despite a decline in project inquiries and the value of newly signed design contracts, work pipelines have remained stable in recent years.

“Despite the ongoing decline in billings at most architecture firms, there are a few signs of potential improvement on the horizon. The number of inquiries into future project work continues to grow, and Midwest firms saw billings increase for the fourth consecutive month in December,” said AIA Chief Economist, Kermit Baker, Hon. AIA, PhD. “In general, however, overall conditions remain weak across all specializations. Multifamily residential firms faced the steepest declines, while institutional firms experienced a slightly slower pace of decline compared to earlier in the year.”

Key ABI highlights for December include:

Regional averages: Midwest (51.7); South (47.7); West (45.3); Northeast (44.2)
Sector index breakdown: institutional (48.7); commercial/industrial (47.8); multifamily residential (45.5); mixed practice (firms that do not have at least half of their billings in any one other category) (44.0)
Project inquiries index: 52.9
Design contracts index: 47.5

Regional and sector categories are measured as three-month moving averages and may not align with the national score.

Inside Lighting strives to accurately report certain data on the day it is reported by the AIA, but updates to past data with new three-month rolling averages might not be made. For official and most current reports, refer to the AIA ABI numbers. All ABI data is sourced from the AIA.

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Interpreting the ABI:

The Architecture Billings Index (ABI) is a leading economic indicator of construction activity. It is produced by the American Institute of Architects (AIA) and it reflects the approximate nine-to-twelve month lead time between architecture billings and construction spending.

The ABI is based on a monthly survey of architecture firms that asks respondents to rate the level of their billings (or the amount of new design contracts) as either "increase," "decrease," or "no change" from the previous month. The results are then compiled into an index, where a score above 50 indicates an increase in billings, and a score below 50 indicates a decrease in billings.

The ABI is widely used in the construction industry, as well as by economists and analysts, to track the health of the construction market and to forecast future building activity. It is considered a leading economic indicator because changes in architecture billings often precede changes in overall economic activity, such as employment and GDP.

The ABI provides a snapshot of the demand for design services as well as an indication of the near-term outlook for the construction industry.

The survey panel asks participating architectural firms whether billings increased, decreased or stayed the same in the month that just ended. According to the proportion of respondents choosing each option, a score is generated, which represents an index value for each month.

An index score of 50 indicates no change in firm billings versus the previous month.
A score above 50 indicates an increase in firm billings versus the previous month.
A score below 50 indicates an decrease in firm billings versus the previous month.
NOTE: Index numbers cited for the last three reported months are preliminary.
The regional and sector categories are calculated as a 3-month moving average, whereas the national index, design contracts and inquiries are monthly numbers.

Source: The American Institute of Architects (AIA)