It is Memorial Day here in the US so we are all enjoying a long weekend - hopefully, you are reading this on Tuesday. It is a time to give thanks for all of the service members, past and present, who serve our nation.
Both of my grandfathers served in WWII. One of them was in the infantry and spent time in Germany. He was also a carpenter who passed on a love for building. When I was in architecture school, he told me that he got fired from a jobsite for arguing with the architect. I asked who was right and he just shrugged and smiled.
I'll never know who was right, but that instilled in me a desire to work closely with the tradespeople and learn from their special knowledge. There have been many times that I sought the advice of someone in the field to figure out how to make a detail easier to install while also looking nice.
It is important to learn everything you can from the trades.
-michael
April billings fall again, but not as quickly
The decline of billings continued in April with the index registering 48.3. This is still a reduction month-over-month, but at a slower pace than March.
Inquiries continue to be above 50, which means they are growing. This is a good sign that owners are looking at starting new projects. Unfortunately, new design contracts fell in April.
The commentary this month covers construction employment numbers and also discusses international work at architecture firms. 14% of architecture firms who responded to the survey reported that they have done work outside of the US in the last five years.
April: 48.3, March: 43.6, February: 49.5, January: 46.2, December: 45.4, November: 45.3
ABI April 2024: Pace of billings decline at architecture firms slows slightly
For those interested in how the ABI values are calculated, Archinect did an interesting write-up about it: How to Understand Architecture Business Conditions Using the AIA's Architecture Billings Index.
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Deepfake Financial Scams in the AEC Industry
There have been plenty of scams where bad actors convince an employee to change the payment info on a transaction and many companies have lost lots of money through this. The next generation of scamming is upon us: Arup lost $25M from a scam where a deepfake of their CFO met on a video conference with an employee who then transferred money to criminals.
This is scary and every accountant at your firm should be aware of this.
Arup lost $25mn in Hong Kong deepfake video conference scam
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WSP non-compete test
Last month, we reported that the FTC was implementing a ban on non-compete clauses for non-executives. This month, a story has come to light where engineering firm WSP is arguing that one of their former employees should have a 12-month non-compete.
The case is beyond my level of knowledge about the new statutes, but it is interesting to see how quickly this case has made headlines. This would never have made the news a few months ago.
WSP Resists Employee Release From Noncompete Agreement After Acquisition
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Material Price and Inflation Update
The ABC reported that materials prices were up 0.5% in April, which is a 6% annual rate of increase. It appears that oil and copper were the main drivers of this change.
ABC: Led by Energy, Construction Materials Prices Surge in April
At the same time, the US Bureau of Labor Statistics reported that inflation backed off a bit in April. The Consumer Price Index came in at 0.3% in April, which is a 3.6% annual inflation number. People continue to expect the Fed to lower interest rates later this year.
Consumer Price Index – April 2024
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The Long Path to a Professional Licensure
Archinect did a recent feature on how architecture became one of the protected professions. It is a very interesting history. This 1906 quote from journalist F.W. Fitzpatrick writing about how the nation's fire problem should be blamed on architects is startling:
“In New York, they average 8,700 fires a year; in Chicago, 4,100. Our normal record is three theaters, three public halls, twelve churches, ten schools, two hospitals, two asylums, two colleges, six apartment-houses, three department stores, two jails, twenty-six hotels, one hundred and forty flats, and sixteen hundred homes burned up every week in the year. Last year we indulged in 45,000 fires. The year before we burned up over 6,000 people.”
How ‘Architect’ Became a Protected Title in the United States
