Architectural firms in Iowa appear to have experienced a slight decline in business in the first part of 2024, the Iowa Chapter of the American Institute of Architect’s first-quarter market survey shows.

Nearly 60% of survey respondents reported having 21 or more active projects in January, February or March of 2024, down from nearly 75% in 2023’s fourth quarter.

Twenty-five Iowa architectural firms, or 20% of the Iowa chapter’s active members, responded to the survey, which asked about active projects and project types, clients and business concerns.

This is the second year the Iowa AIA has conducted in-depth quarterly surveys about the market. The architectural profession typically serves as a barometer for the amount of construction activity that is likely to occur in nine to 12 months.

Other highlights from the first-quarter report include:

• 16% of active projects were related to K-12 education, the same as 2023’s fourth quarter. Projects related to single-family residences accounted for 14% of active projects, a slight increase from the previous quarter.
• About 25% of firms’ clients were the state or local governments, a decline from the fourth quarter, when 28% of clients were from the public sector.
• Issues related to the workforce were the top concern of survey respondents, with nearly 50% indicating “great concern” with the issue. In the fourth quarter, workforce was firms’ fourth top concern.
• 72% of respondents indicated their firms were hiring more employees. In the fourth quarter, 59% of firms said they were hiring more employees.

In a related release, architecture firm billings in Iowa and the Midwest mirrored that of the rest of the nation, which continue to be soft, according to the latest AIA/Deltek Architecture Billings Index.

According to the report, the index score for the Midwest in April was 44.2, compared to the national score of 48.3.

Other regional scores were 45.9 in the Northeast, 44.7 in the South and 47.8 in the West.

Index scores for sectors were 47.4 for commercial and industrial, 46.1 for institutional, 45.6 for multifamily residential, and 43.9 for mixed practices, or those architecture firms that do not have half their billings in one specific category.

The index is a leading economic indicator of construction activity, providing a look at nonresidential construction activity for the next nine to 12 months. Regional and sector categories are calculated as three-month moving averages and may not average out to the national score. Any score below 50 represents decreasing business conditions.

“The Midwest region started the year strong in January at 50.3 points, but the last three months we joined the other areas of the U.S. with billings sinking to a low of 44.2 points. The last time the Midwest was near this low was August-December of 2020,” Jessica Reinert, AIA Iowa’s executive director, said in a prepared statement. “According to the AIA Iowa Q1 2024 Market Report, Iowa architecture firms reported that inquiries and design contracts are growing.”