ASID Billings Index for Summer 2011
Interior Design Billings Weak in 3rd Quarter
After Initial Drop, Modest Improvement
Results of the ASID Interior Design Business Performance survey for the third quarter of 2011 signaled that business conditions for the interior design industry were very similar to the broader U.S. economy--sub-par economic growth.
The ASID Interior Design Billings Index fell to its lowest point in July (45.1), then recovered in August (48.6) and increased slightly in September (48.2), but has yet to reenter positive territory (above 50.0).
On a positive note, the Inquiries Index was up nearly 10 points over August (55.1 vs. 45.8) indicating a possible uptick in the fourth quarter, possibly seasonal.
Across market sectors, billings continue to soften compared to the first half of the year. Some sectors did register an increase in September, as well as increases in inquiries.
- In residential, both multi-housing and single family reported increases in September. This is consistent with the Bureau of the Census Construction Spending Report that shows increases in new single and multifamily structures.
- The commercial sector (defined as retail, entertainment, hospitality and office sectors) has been in decline since April and continued to be weak in the third quarter. Office and retail showed some improvement in September.
- Likewise, all three components of the institutional sector (government, education and health care) declined through the summer months. Still, the US Census Construction report for private nonresidential construction is showing strength in some of these sectors, including new investment in hospitals and clinics.
These trends may suggest why, even with the national downturn in billings during the third quarter, billings were up in September for all firm size groups except for firms with between 2 and 9 employees (also possibly a seasonal occurrence). The rebound in office and retail may have influenced the similar rebound in firms with between 10 and 24 employees.
By regions, both the West and the Northeast improved over the last three months, even though the national index showed a downturn. Comparing the ASID and AIA indexes, the Northeast region was the only region that both architectural and interior design firms tracked on a positive trajectory together. Likewise, architectural firms and interior design firms in the South showed that business conditions have deteriorated there.
When asked in what product categories they had seen an increase in specification or sales, respondendents most often cited lighting, window covering, paint and fabric.