The Construction Monthly Metals Index (MMI) picked up by 4.9% for this month’s reading.
US construction spending
U.S. construction spending reached a seasonally adjusted annual rate of $1,568.8 billion in July, the Census Bureau reported earlier this month.
The July rate marked a 0.3% increase from the previous month. Furthermore, the July figure jumped by 9.0% compared with July 2020.
During the first seven months of the year, construction spending totaled $883.2 billion, up 6.2% year over year.
Private construction spending reached a rate of $1,231.0 billion, or up 0.3%. Within private construction, residential construction reached an annual rate of $773.0 billion in July, up 0.5% from June. Nonresidential construction came in at $458.0 billion in July, or down 0.2%.
Meanwhile, public construction reached $337.8 billion, up 0.7%. Educational construction checked in at $79.7 billion, down 0.5%. Highway construction rose by 1.9% to a rate of $94.5 billion.
ABI growth slows in July but remains in positive territory
The Architecture Billings Index, released monthly by the American Institute of Architects, posted a reading of 54.6 for July. Any reading greater than 50 indicates billings growth.
While the ABI remains on a strong run of index values greater than 50, the July index declined from 57.1 the previous month.
Furthermore, the design contracts index checked in at 58.0, down from 58.9 the previous month.
“Although the torrid pace of billings growth seen earlier this year eased in July, architecture firms are still reporting very strong business conditions overall,” the ABI report stated. “The ABI score of 54.6 for the month indicates that the majority of firms are continuing to see their billings increase. Inquiries into new projects and the value of new design contracts remain extremely high as well, with both still near their all-time historic high points from earlier this year.”
By region, the Midwest led the way with an ABI value of 58.3. Trailing the Midwest were the West (56.0), South (54.6) and Northeast (54.1).
Overall, architecture firms are fairly sanguine about their revenue prospects for the remainder of the year.
According to the results of the AIA’s monthly survey, 47% of firms said their revenue in the first half of 2021 increased compared with 2020. In addition, 54% of architecture firms indicated they expect revenues to increase in the second half of 2021 compared with the first half of the year.
However, as continues to be a running theme across sectors, material availability remains a significant challenge.
When addressing factors that could weigh on their H2 2021 revenue projections, 58% of responding firms cited rising prices of key construction materials and products. In addition, 53% indicated supply chain disruptions and availability for key construction materials and products could be an issue.