Showing posts from category: recession
Signs of recovery – but some practices just hanging on
Work for architects in the US stayed close to break-even level during the first quarter of this year.
The American Institute of Architects reported that the score for its Architecture Billings Index was 50.5 for March – down slightly on the 50.6 recorded the previous month. Any mark above 50 reflects an increase in billings. The new projects inquiry index was 58.7, up from February’s figure of 56.4.
AIA chief economist Kermit Baker said: “Currently, architecture firms are essentially caught swimming upstream in a situation where demand is not falling back into negative territory but also not exhibiting the same pace of increases seen at the end of 2010.
“The range of conditions reported continues to span a very wide spectrum with some firms reporting an improving business environment and even ramping up staffing, while others continue to operate in survival mode. The catalyst for a more robust recovery is likely financing.”
Article via Building Design Mag
Uptick in business has them cautiously optimistic about a rebound
Some of the larger architectural firms in Aspen and Basalt have hired additional employees this spring after cutting up to half of their staffs during the recession.
Poss Architecture and Planning, Harry Teague Architects, Cottle Carr Yaw Architects and Design Workshop’s Aspen branch have each hired three or four workers in recent weeks. Partners in each firm said business is up this spring and they are bringing on additional workers to help with projects on the books.
“This year is just different from last year in a positive way,” said John Cottle, a partner with Cottle Carr Yaw Architects.
However, the owners of each of the firms said they remain very cautious about the business outlook because there is so much uncertainty beyond the next year or so. Bill Poss said 2007 and 2008 were the best years in his firm’s 35-year history. He doesn’t expect business to return to that level in some time. On the other hand, any uptick in business over 2010 is welcomed.
“Last year was pretty bad,” he said.
Architectural firms are somewhat like a canary in the coal mine for the construction industry. Projects they work on translate into work for contractors and subcontractors six months or so later. Poss said he is constantly being quizzed by friends in the construction world who want to know if his business is picking up.
The answer isn’t a simple yes or no. His firm is working on a large hotel in North Carolina that had been temporarily placed on hold when the recession hit. It is an encouraging sign that the owners have felt the economy has recovered enough that they are moving ahead with the design, Poss said. “That’s about a 12-month deal” for his firm, he said.
Poss is getting more calls this year than last year from property owners in the Roaring Fork Valley who are considering building homes. While the interest is encouraging, he noted that “nobody’s pulled the trigger, so to speak.”
Consumers of architectural services, like consumers of all types, are shopping for the best prices. His firm has reduced its prices, which required it to cut costs. That meant laying off employees after the recession struck, and cutting salaries for the remaining staff.
Poss said he and his partners recently hired three more drafting people and interns and are considering hiring a fourth person. Even so, the firm isn’t anywhere close to where it was three years ago in terms of the staff count when it employed 56 people. That fell to about 22 at the lowest point and is now creeping back toward 30 workers, he said.
Poss said business has always been cyclical. He has experienced a downturn every five to seven years. This downturn was different because it was so severe and long. He said laying off so many employees was unpleasant because it had so many consequences.
“I had to lay off 30 families, not just individuals,” he said.
Harry Teague, another longtime veteran architect in Aspen, said it has been common over the years for the staffs of architectural firms to expand and contract, depending on the firm’s number of projects. Employees who were laid off from one firm could usually find work with another.
“The roller coaster is not particularly unique to this time” he said.
What was different in this cycle is that business dropped off for virtually all firms at once, according to Teague. That was tough because people who were laid off had a tough time finding new jobs with different firms.
Teague said his firm’s work is also picking up this year so he has hired four people, boosting the total to 12. He described the positions he hired for as a mix of architects, project managers and designers as well as interns.
Teague’s firm is working on a project at the Aspen Music School campus on Castle Creek Road, including the replacement of a building that can no longer be used. His firm is also designing a school in Crestone, Colo., a home in Telluride and a home in the Roaring Fork Valley. He is also the architect for a river center proposed by the Roaring Fork Conservancy in Basalt. That project is scheduled to be reviewed by the Basalt Town Council and Basalt Planning and Zoning Commission on Tuesday.
Overall, Teague said, it does feel as though the level of activity is increasing.
Cottle said his firm is staying busy with a combination of local, regional and even international projects, a combination of residential and commercial.
“Aspen is stronger than most of the other places where we work,” he said.
The firm is receiving more calls of inquiry so far this year compared to the last couple of years, he said. Cottle is encouraged because potential clients are exploring a variety of projects and seem serious about moving ahead.
The firm recently added four positions, one permanent and three tied to current projects, Cottle said. It’s too soon to tell if business has truly turned around, so he and his partners will remain cautious with their projections and with their hiring. Cottle said they don’t want to get in a position of hiring workers for permanent positions only to lay them off again. That’s rough on everybody, he said.
Cottle Carr Yaw employed 38 workers from 2000 through the end of 2008 and intentionally didn’t expand beyond that point. They laid off roughly half the staff during the lean last couple of years and are back to 20 employees with the recent hires.
Kurt Culbertson, chairman of the board for Design Workshop, said the firm hired two entry-level workers and two mid-level experience workers in its Aspen office within the last six months. The position were for landscape architects. They are looking to fill another two positions.
The firm — which also has offices in Denver, Tahoe, Austin, Salt Lake City, and Asheville, N.C. — works on everything from resort planning to residential gardens. The Aspen office is benefiting from an increase in business overseas as well as domestically and in the Roaring Fork Valley, according to Culbertson. He said some potential clients are even looking into real estate development, which has been on hold for the last couple of years.
Culbertson said the Aspen office of Design Workshop reduced its staff by about half after the recession.
“It hasn’t been fine times,” he said.
He’s been with the firm through five recessions, this one being the worst. The name of the game is living to fight another day.
“You can’t hire people back if you’re not in business,” Culbertson said.
Via The Aspen Times
architects, architecture, architecture jobs, construction, new buildings, recession, Residential, unemployed architects
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Basalt Town Council and Basalt Planning and Zoning Commission, canary in the coal mine, chairman, construction industry, Cottle Carr Yaw Architects, Design Workshop, Harry Teague Architects, John Cottle, Kurt Culbertson, Poss Architecture and Planning, recession, Roaring Fork Valley
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Texas has won Site Selection magazine’s 2010 Governor’s Cup for having the most new and expanded corporate facilities, while Dallas-Fort Worth was third among metro areas of 1 million or more, it was announced Tuesday.
Texas led all states with 424 projects, 50 more than in 2009, when it placed second. Ohio, which won the last four Governor’s Cups, was second with 376 projects, followed by Louisiana, 347; Pennsylvania, 337; and Georgia, 251.
“As well as Texas has done in the past and in 2010, we’re not going to be what we can be, or as strong as we can be, unless we have competition from other states,” Gov. Rick Perry said in a prepared statement.
The Chicago area, including parts of Wisconsin and Indiana, was the top metro area, followed by the Houston area.
Site Selection has awarded the Governor’s Cup since 1978. The rankings are considered a benchmark by corporate real estate analysts.
David Berzina, executive vice president of economic development for the Fort Worth Chamber of Commerce, said the chamber was involved in attracting 10 projects to the city last year, which added 1,057 jobs and $130 million in annual payroll.
The projects included a 190,000-square-foot expansion for General Mills and a 65,000-square-foot expansion for LG Electronics at the Alliance industrial park in far north Fort Worth, as well as the sale of the Ranch Style Beans plant near downtown Fort Worth to Allens Inc., which has reopened the plant to can vegetables and hired about 120 workers.
“We’re consistently ranked, relative to our population, in the top three or four in the last 10 years,” he said.The chamber worked on 89 possible deals in 2010 and landed the 10, Berzina said.
This year, the chamber has worked on seven new relocation possibilities, he said. The targets include a data center, a large office project and a “green energy project,” he said.
“Four of them I would say are warm; three are tire-kickers,” Berzina said.
“Gov. Perry has worked diligently in recent years to make his state pro-business, which is why Texas ranks as high as it does on matters of interest to site selectors,” said Mark Arend, editor-in-chief of Site Selection.
The rankings are based on new corporate location projects and do not track retail or government projects, schools or hospitals. To be considered, a new facility or expansion must involve capital investment of at least $1 million, create at least 50 new jobs or add at least 20,000 square feet of space.
Via Star Telegram
architects, architecture, architecture jobs, Green Architecture, recession
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Alliance industrial park, David Berzina, Fort Worth Chamber of Commerce, General Mills, Gov. Rick Perry, Governor's Cups, green energy, LG Electronics, Ranch Style Beans
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Don’t string me along says architecture temp Althea Norwood Roberts
* Quarter of jobs created in past year were temporary
* Temps about 2 percent of overall employment
* Companies still cautious about permanent hiring
By Kristina Cooke
NEW YORK, Feb 22 (Reuters) – Althea Norwood Roberts gives employers three months to turn her temporary job into a permanent one. Then she looks elsewhere.
That’s as long as a company needs to see if she’s a good fit, the 35-year old single mother from California believes.
Norwood Roberts, currently temping for an architecture firm, is like millions of other Americans who are wondering if she will get permanent work.
“Temping is kind of like dating. It’s a trial-run for the company,” she said. “If they can’t make up their mind about you after 90 days, it’s probably not going to happen, they’re stringing you along.”
Norwood Roberts, who has a five-year old daughter, wants a job with security, good benefits and a pension. “It is not optional at this point. It is a necessity,” she said.
In the past year, about a quarter of all jobs created in the United States were temporary as companies remained cautious about the outlook for the economic recovery.
Over the past three recessions, temps — who are easier to hire and fire — have suffered the quickest and most severe cuts to their numbers at the beginning of a downturn, and then led broader employment gains when the economy recovered. For a graphic see http://r.reuters.com/geb97r
The pace of temporary job creation after the most recent recession — an average of about 25,000 per month — has been faster than in the past two, potentially a good sign for a labor market struggling with a jobless rate of 9 percent.
In the 17 months after the 2001 recession — the same period which has lapsed since the one in 2007-09 — employers added just 1,400 temporary jobs a month and the lag between the pick-up in temp hiring and the economy starting to add full-time jobs was 10 months longer.
But the faster pace of temporary hiring this time around hasn’t yet translated into significant full-time job creation.
“It will be a really good sign when we see those temporary jobs turn into permanent jobs,” Federal Reserve Chairman Ben Bernanke said this month.
Peter Capelli, a professor at the University of Pennsylvania’s Wharton School, says the jury is still out on whether the U.S. labor market is undergoing a structural change towards more temp workers or whether companies are just biding their time until demand for their products picks up and they add more long-term employees.
“It’s probably a bit of both. Another thing may be that employers are using temp work as a more thorough interview process, so it could be masking permanent hiring,” he said.
That is a trend that Randstad, the world’s second-biggest staffing firm, is seeing.
Randstad said more of its clients than in prior recoveries are using a “temp to perm” approach to hiring, to try the employee out before committing to taking them on.
NO LOYALTY BOTH WAYS
Some companies are actively shifting to what they say is a more flexible workforce.
In January, Lowe’s, the home improvement giant, slashed 1,700 middle-management jobs and said it would add thousands of part-time customer service employees.
One of the middle managers laid off was Dean Lutz, 43, from South Carolina. Lutz says the job market is the worst he has seen in his career, with most available jobs either seasonal or part-time.
“Honestly, jobs available out there aren’t very good.” he said. Companies “don’t want to pay benefits or higher wages.”
Lowe’s move is “emblematic of an evolution that took place starting in the late 1970s in which employers showed less commitment to their workers,” said Gary Burtless, a professor at the Brookings Institution.
But he said there is little evidence to suggest that temporary hiring has become more common in the past couple of years, with temporary workers as a share of overall employment peaking at 2.4 percent at the height of the dotcom bubble.
Despite the faster pick-up, the number of temporary jobs is still down about 15 percent from before the recession.
Tom Bonds, vice president of operations at the Huron Valley Steel Company in Anniston, Alabama, said he expects a shift back to permanent workers once there is more clarity about the economic and regulatory outlook.
“We prefer full-time workers, because they are going to be there … with temps there is no loyalty both ways,” he said.
While temporary workers may be high caliber at times of high unemployment, the cream of the crop may be quickly snapped up once the recovery picks up steam.
Norwood Roberts, the single mother in California, is optimistic. She has had two previous temporary jobs in the past 10 years, both of which turned into permanent positions.
“I have been able to juggle things so far. Some people don’t have that luxury,” she said. “I am one of the lucky ones.”
(additional reporting by Nick Zieminski, Dan Burns and Dhanya Skariachan)
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* January ABI 50.0, down 3.9 pts
* New projects index falls 5 pts to 56.5
* Cautious optimism for design industry: AIA
NEW YORK, Feb 23 (Reuters) – A leading indicator of U.S. nonresidential construction activity weakened last month after two months of improving numbers, an architects’ trade group said on Wednesday.
The monthly Architecture Billings Index fell almost 4 points in January to 50.0, a level that indicates neither expansion nor contraction of demand for design services, the American Institute of Architects said.
The billings index is considered a predictor of construction spending about nine to 12 months in the future, since buildings are designed long before they are erected. The latest readings suggest an anticipated recovery in U.S. nonresidential construction may not gain traction this year.
A separate index of inquiries for new projects fell more than five points to 56.5, according to the AIA.
“This slowdown is indicative of what is likely to be a very gradual improvement in business conditions at architecture firms for the better part of this year,” said AIA chief economist Kermit Baker. “We’ve been taking a cautiously optimistic approach for the last several months and there is no reason at this point to change that outlook.”
The AIA’s billings index dropped below 50 in January 2008, indicating falling demand, and stayed below that mark until last November. The separate inquiries index only fell below 50 briefly in 2008. It is typically higher than the billings index, as prospective customers solicit bids from multiple architecture firms.
Most diversified industrial companies get at least some revenue from nonresidential construction, selling machinery used for erecting buildings or components such as elevators or electrical and cooling systems.
Construction spending fell 2.5% sequentially in December to a seasonally adjusted annual rate of $787.9 billion, 6.4% behind the rate of December, 2009, the Commerce Department reported Tuesday morning.
Residential construction fell 4.1% from November to a rate of $226.4 billion, a drop of 6.3% from the prior December. Total private construction was at a rate of $486.9 billion, 2.2% below the revised November estimate of $498.0 billion and 9.8% below December, 2009.
The value of private construction in 2010 was $507.3 billion, 14.3% behind 2009. Residential construction in 2010 was $241.4 billion, 1.7% below 2009.
For public construction, the seasonally adjusted annual rate was $301.0 billion in December, 2.8% below November and 11.2% below December, 2009.Highway construction was at a rate of $84.9 billion, 1.6% below November but 7.5% ahead of December, 2009.
The value of public construction in 2010 was $306.8 billion, 2.7% below 2009. Educational construction in 2010 was $74.4 billion, down 13.6% from 2009, and highway construction was $83.3 billion, 1.7% above 2009.
Via AIA.org
Mr. LiMandri, 45, is the commissioner of the Department of Buildings, which oversees nearly a million properties in New York City, by enforcing various building codes and laws. He was appointed in 2008, after the resignation of Patricia J. Lancaster, following a series of construction accidents, including a crane collapse in Manhattan that killed seven people.
Robert D. LiMandri
Q The department just released its 2010 annual report. Can you discuss some of the numbers?
A There are 975,000 buildings and properties in New York City and we have 1,109 employees, 337 of whom are inspectors. We performed 335,449 inspections last year; issued 136,294 construction permits and 1,517 new building permits and 67,069 violations.
What many people don’t realize is that we do about 450,000 plan reviews a year. Last year it was 457,375. That rivals some of the largest architectural firms.
Q Do you have more or fewer inspectors now?
A Slightly fewer, through attrition and budget cuts. But we’re doing more with less and using technology to be more efficient.
Q How so?
A We’ve been trying to make it easier for people to get permits, to do plan reviews, online. Electricians can go online as of last year: they put in their ID numbers, pay for the permit online and print it. Construction permits will also go online this year.
The other piece is dealing with plans online. We hope to pilot that by the end of this year. You would submit your plans — the simplest plans, not the big complicated ones. You open an account with us, send it to us electronically. We look at it when we’re available — we might ask questions or note objections — and e-mail it back to you.
Q Could this work with the big developers?
A The number of large buildings that get built every year is like 200 to 300. So if you are a large developer/owner like the Rudins or the Resnicks, you’re doing these kinds of filings on a regular basis. Instead of hiring someone to drop off stuff for us to look at, they can save transaction time.
Q How much time?
A We saw that when they went online for electrical permits, the processing time went from days or weeks to minutes.
Q Getting back to the annual report, what does it tell us about the city’s recovery?
A It’s in pockets. Permits for new buildings and major alterations fell around 19 percent last year, to 13,000 from 16,000. But permits for small-scale alterations — like moving a wall — rose 6 percent, to nearly 103,000. People are still doing smaller work, and that drives the economy as well.
We’re starting to see pockets of demolitions. We just had seven or eight sites in the last couple of weeks. When you see demolitions come back, it’s a leading indicator that development is coming.
Also, in Manhattan there are four or five large sites, where maybe they slowed construction, that are starting to pick up. It’s the heart of the winter so it’s going to be slow anyway, but we’re hoping that the spring will bring a set of new buildings.
Q It’s been over two years since you took office. What are some of your biggest accomplishments?
A We’ve been working on transforming this department — making it more accountable and instilling confidence in our training programs. We put G.P.S. tracking on our 337 inspectors, so we know where our people are. We conducted a facade safety initiative, and we investigated illegally converted apartments. We used Craigslist and posed as tenants.
Q Have you been able to curb construction accidents?
A We had a reduction in 2010 from the year before by about 28 percent. Clearly there’s been less large-scale construction, but also I am very satisfied that the industry has heard us and responded.
Contractors are using cocoon-netting systems to protect the top four floors during the very early stages of construction. These innovative systems prevent people from falling, as well as falling debris. I’m hoping it will become a city standard.
Building a building is complex, and there are a lot of people you depend on to do it well, and it takes just one of them not to do their job for things to go awry. Our job is to make sure that they put safety ahead of profit.
Q Let’s talk about some of the new regulations for this year.
A The big thing that’s coming down the pike is the Greener, Greater Buildings Plan, which will rank buildings by energy efficiency. Owners have to benchmark their buildings — if they’re over 50,000 square feet — and upload information about utility bills into a federal Web site by May 1. The next step is that every 10 years they will have to go through an audit process.
Hat tip to the NYT
Read article via NYT – Jan 20, 2010
The American Institute of Architects (AIA) reported today that following on the heels of the first positive reading since January 2008, the Architecture Billings Index (ABI) dropped nearly two points in October.
As a leading economic indicator of construction activity, the ABI reflects the approximate nine to twelve month lag time between architecture billings and construction spending.
The October ABI score was 48.7, down from a reading of 50.4 the previous month. This score reflects a decrease in demand for design services (any score above 50 indicates an increase in billings). The new projects inquiry index was 61.7, down slightly from a nearly three-year high mark of 62.3 in September.
“This is disappointing news, but not altogether that surprising,” said AIA Chief Economist Kermit Baker, PhD, Hon. AIA. “We were anticipating a slow recovery period and it is likely that there will be some fits and starts before conditions show consistent improvement. Right now, reluctance from lending institutions to provide credit for construction projects and a sluggish economy are the main impediments to a revival of the design and construction industry.”
Key October ABI highlights:
- Regional averages: Northeast (54.5), Midwest (51.8), South (48.6), West (44.3)
- Sector index breakdown: commercial / industrial (54.5), institutional (50.8), multi-family residential (49.1), mixed practice (43.2)
- Project inquiries index: 61.7
Via Real Estate Channel
Optimistically speaking. demand for architects seems understandably uncertain through the year 2011. While filling positions within the architectural field will depend on geographic location of employment, and specialty in the field, among many influences.
Since architect employment is affected more so by the overall trend of commercial building construction and re-development efforts than many construction-related positions, it will no doubt be subject to the downturn of the commercial real estate market that had hit the United States (spring of 2009 onward). But, in the event of a shifting emphasis toward rehabilitating and transforming existing structures, if new construction costs continue to rise across many parts of the country, architects may look more toward employment with firms that are well established.
Overall, a large number of commercial architects may find opportunities slim, depending on their specialty. Although areas such as those involved with healthcare, security, defense and technology; positions may hold or even increase in the coming years depending on the effects and whereabouts of funding brought about by the Obama administration efforts. Architect jobs in the residential sector can probably expect to experience a downgrade given the state of new residential housing starts (early 2009) although this might turn if affected by favorable interest rates and banking procedures. Still, since the service of the residential sector is mainly comprised of the self-employed, trends of employment in this sector is debatable as many architects may transfer from private/contractor employer firms.
The entire architect job market will undergo rising competition. Demanding proven experience and track records and abilities for those well seated in the workplace and while becoming more specialized for those entering the workplace. Computer CAD has long since become a given requirement.
Competition for entry level positions on-up is likely to produce a wealth of labor and choices for employers of architects.
Hat tip to Referworks
