The Construction Economist — September 26, 2026

Architecture billings stay below 50 as firms turn gloomier · Construction starts drop 24.8% · The House takes up data-center power costs · California rewrites data-center siting · Mass timber saves $2M

Top News

Architecture billings stay in decline at 47.2 in August as firms turn more pessimistic American Institute of Architects · ~3 min read

The AIA/Deltek Architecture Billings Index (ABI), published by the American Institute of Architects (AIA), registered 47.2 in August, up from 46.6 in July but still below the 50 mark that separates growth from decline — a line national billings have not crossed since January 2023. The project inquiries index slowed to 50.8 from 52.6, the design contracts index rose to 48.3 from 47.2, and Northeast billings fell to 40.7, the region's lowest since 2020, while the Midwest (50.7) posted its first growth in nearly a year. The share of firm leaders expecting billings to decline next quarter rose to 29% from 21% at the end of the first quarter, and AIA chief economist Richard Branch said the Federal Reserve's latest rate increase "adds another headwind" for projects already facing a difficult financing environment.

What it means: The uptick is the wrong kind of good news. The gap between inquiries and signed contracts narrowed from 5.4 points to 2.5, but mostly from the top — inquiries fell 1.8 while contracts gained 1.1 — so the front of the design pipeline is thinning, not converting. With the ABI leading nonresidential construction by nine to twelve months, budget for a thinner private bid market into the second half of 2027, weakest in the Northeast; Dodge's 24.8% drop in August starts, below, is the same slowdown showing up one stage later.

Construction starts fall 24.8% in August Dodge Construction Network · ~3 min read

Total construction starts declined 24.8% in August to a seasonally adjusted annual rate of $1.34 trillion, according to Dodge Construction Network. Nonresidential building starts fell 32.0% from July and residential starts fell 5.2%, while nonbuilding starts also declined.

House approves bill on data centers paying for their power infrastructure AGC News · ~2 min read

The House of Representatives approved bipartisan legislation that encourages states to adopt standards requiring large data centers to pay for the electricity infrastructure needed to support their operations.

Policy, Codes & Regulation

Cities get more say in data center development under new California laws Construction Dive · ~3 min read

Gov. Gavin Newsom signed seven bills into law on Sept. 21 that change how data centers are developed in California. Under the new laws, developers must disclose energy and water use, pay more toward grid infrastructure and undergo environmental review.

SBA extends comment deadline on small business size standards to Nov. 20 AGC News · ~2 min read

The U.S. Small Business Administration (SBA) extended the comment period on a proposed rule that could change how small businesses are defined for federal contracting. Comments are now due Nov. 20, following a request for more time from the Associated General Contractors of America (AGC).

Project Finance & Economics

California High-Speed Rail Authority's spending criticized by its inspector general Smart Cities Dive · ~3 min read

The California High-Speed Rail Authority paid more than $2 million in questionable expenses for consultants while facing a financial crisis, according to the authority's Office of the Inspector General. The watchdog described the spending as wasteful.

Labor & Workforce

Dallas Fed forecasts 1.7% Texas job growth in 2026 Federal Reserve Bank of Dallas · ~2 min read

The Dallas Fed's Texas Employment Forecast projects jobs in the state will increase 1.7% in 2026. The forecast carries an 80% confidence band of 1.3% to 2.1%.

Materials & Supply Chain

Mortenson: Mass timber use shaved $2M in costs from college build Construction Dive · ~4 min read

Mass timber and value engineering cut about $2 million in costs from a building at Western Washington University, according to contractor Mortenson. Mortenson said the material choice also shortened the project schedule.

The Construction Economist — What's Moving Construction? The Economic Look-Ahead.