Contract - November 2016 - 22

AIA 2016 Firm Survey Report
Indicates Revenue Growth

Firms also reporting
moderate increases in diversity
in architecture workforce

More architecture firms report profitability
Profit after compensation, but before taxes, discretionary bonuses,
and profit-sharing as percentage of net billings; percentage of firms
very profitable (20%+)
quite profitable (10% to 20%)
modestly profitable (under 10%)
reporting loss

13.4%

19.2%

2011

9.7%

13.7%

21.5%

16.3%

2013

22.0%

2015
24.1%

45.4%

41.2%

27.6%

45.9%

Women and minority percentages slowly climbing at firms
Women and racial/ethnic minorities as percentage of all architecture staff,
and principals and partners
Share of architecture staff
Share of principals/partners
women
35%
30%
25%
20%
15%
10%
5%
0%

16%

17%

17%

17%

2005

2008

2011

2013

2015

25%

20%

minorities
19%

19%

20%

21%

11%

12%

11%

11%

2008

2011

2013

2015

16%

15%
10%

31%

27%

25%
20%

28%

26%

8%

5%
0%

22

2005

Through 2015, U.S. architecture firms had rebounded with zeal from
the negative impact of the Great Recession, according to the American
Institute of Architects (AIA) Business of Architecture: 2016 Firm Report.
The report, which published in September with data from more than
2,300 firms, shows that less than 10 percent of firms reported financial
losses in 2015, while nearly 20 percent of firms had losses in 2011.
Net billings for U.S. architecture firms have bounced back to nearly
the 2008 market peak of $28.5 billion, netting $28.4 billion last year.
Firms are increasingly multidisciplinary. In 2015, 42 percent
of firms described themselves as multidisciplinary, meaning that they
offer architectural services as well as at least one other design
discipline, such as interior design. In 2005, only 29 percent of firms
were multidisciplinary. The findings also indicate that increased
profitability has enabled firms to increase marketing and expand
geographically in an effort to diversify portfolios.
"Far more than at any point in recent memory, there has been
steady rise in the amount of renovation projects that architects have
led compared to new construction activity over the past decade plus,"
said AIA Chief Economist Kermit Baker, Hon. AIA. "A lot of this has
to do with green building incentives towards renovations, improved
construction methods and products that increase the longevity
of buildings, and a slower growing population that reduces the need
for new construction."
Firms are also diversifying personnel, although slowly, with
women and minorities accounting for 31 and 21 percent of staff,
respectively, through 2015. In 2011, the percentage of women in firms
was 25 percent, and minorities were 19 percent.
The size of a firm has a significant impact on its health in
given economic conditions. According to the report: "During economic
recoveries... big firms [are] often picking up a disproportionate share
of new projects. This was the case in [this] survey. For example, firms
with 50 or more employees, which account for only five percent
of firms but which employ 47 percent of staff at U.S. architecture firms,
generated over 51 percent of national architecture firm billings in
2015. Conversely, firms with fewer than 50 employees saw a declining
share of billings."
For this report, information was provided from those
architecture firms that have an AIA member in an ownership
position. Research conducted by AIA estimates that those firms
generate almost two-thirds of architectural and related services
revenue. Visit www.aia.org/firmsurvey to learn more and purchase
the report. -WILL SPEROS AND JOHN CZARNECKI

contractdesign.com

NOVEMBER 2016

GRAPHICS: COURTESY AIA

I NDUSTRY NEWS
http://www.aia.org/firmsurvey http://www.contractdesign.com
Contract - November 2016

Table of Contents for the Digital Edition of Contract - November 2016
