Architecture profession (Down Under) leads surge in country’s employment

News brief – October 2010

Via Architecture & Design 

A rebound in the architecture profession is helping drive the overall labor market recovery in Australia.  Commenting on the rise in the official labor force figures yesterday, Westpac chief economist Bill Evans attributed the growth to a rebound in professions in law and architecture.  “They’re quick to fire, but they’re quick to rehire as well,” says Evans.  Mr. Evans was forecasting the unemployment rate to bottom out at 4.8 per cent halfway through next year.

Prospects for Architect Jobs, Future Employment

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

Architecture Billings Index Climbs by Two Points in July

Commercial/industrial sector reports growth for third consecutive month

Summary: Although billings at architecture firms declined for the 30^th consecutive month in July, the ABI score increased by nearly two points from the previous month, inching closer to 50. In addition, business conditions continue to improve at firms with a commercial/industrial specialization, despite persistent weakness in the general economy. Survey panelists report that the design phase for nearly half of their projects lasts for less than six months, and that the complexity of the project is the most important influence on the length of that design phase.

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The AIA’s Architecture Billings Index (ABI) score for July inched closer to the 50-point threshold again (a score higher than 50 is an indication of growth), climbing nearly two full points from June to 47.9. While there is growing optimism that billings may grow in the near future, business conditions at many architecture firms remain tenuous, with relief still a long way off.

Inquiries into new work have grown for 16 of the last 17 months, but this month’s score of 53.1 is the lowest since the beginning of the year. However, this may represent a leveling out of the glut of RFPs that firms have been receiving in recent months that have not translated into actual billable work.

Business conditions remain weak at architecture firms in all regions of the country. Firms in the Northeast continue to report the highest scores, but they have been weakening every month since very minimal growth was reported in April. The score increased in the South for the fifth month in a row in July, and is approaching 50 for the first time in more than two years.

Firms with a commercial/industrial specialization reported growth for the third month in a row in July, and while it remained minimal, it is still a positive sign. The highest score in nearly two years for that sector was reported at firms with an institutional specialization, amid reports that building projects funded under the stimulus program are beginning to wrap up.

The most recent issue of the Federal Reserve’s Beige Book reports that, for the most part, the commercial and industrial real estate market remains weak in all regions of the country. However, while vacancy rates in many areas are flat or increasing, office/retail leasing actually has been increasing in New York City. Construction activity continues to weaken in the Atlanta, Minneapolis, Dallas, and Cleveland, but public infrastructure construction is on the rise in Chicago, and most Federal Reserve Board districts anticipate slow growth in commercial/industrial real estate in the near future. And, employment data continues to paint a mixed picture. While overall nonfarm payroll employment declined by 131,000 positions in July, the private sector continued to add jobs, with an additional 71,000 positions. Construction employment remains relatively flat, shedding just 11,000 jobs in July.

This month’s special questions followed up on last month’s questions about the timing of project design phases. Survey respondents reported that the largest share of their projects (42%) have a design phase (defined as lasting from the awarding of the design contract to the completion of the construction documents) that lasts less than six months, while an additional 24% of projects have a design phase typically lasting between six and nine months. Small firms are much more likely to have shorter design phases than large firms, with 59% of projects at firms with less than $250,000 in annual billings having design phases of less than six months, compared to just 23% of projects at firms with annual billings of $5 million or more. Projects at firms with an institutional specialization also tend to have a slightly longer design phase, with nearly half (47%) of projects at those firms having a design phase lasting between six and 12 months.

Our panelists indicated that the complexity of a project is the most important influence on the length of the design phase, followed by project size (construction value), type of client, and scope of design services offered. The project delivery method (e.g., design-build, design-bid-build, integrated project delivery) was not considered to be a very important factor.

To View Additional Charts click here.

Article via AIA.org

8 Occupations With Increased Demand

6. Production
7. Construction and Extraction
8. Healthcare Support

The Bottom Line
Online job postings have increased in almost every sector according to Monster’s Employment Index, with computer, education and office and administrative jobs also seeing double-digit percentage growth. So what does this mean for our economy? What’s important to note about Monster’s numbers is that mining, manufacturing and transportation and warehousing are the industries showing the largest growth – with mining seeing an impressive 53% gain since 2009. Any economic analyst will tell you this means an increase in production, a possible early indicator of economic recovery. Good news, even if you’re not looking for a job.

View all 8 ocupations via Financial Edge

Design Fees: Self-Inflicted Losses

Via ARCHITECT
By: Ernest Beck

The second installment of our series on architectural fees finds that increased competition for even the smallest of projects is leading firms to slash rates. But have things gone too far?

When a major New York financial institution asked three architecture firms to submit bids for a high-end office renovation last year, it was a relatively small project, but one that was eagerly sought by the bidders to keep revenue flowing in tough times. What transpired reflects the cutthroat nature of the industry these days: Two firms came in at around $175,000, while the third offered a bargain-basement price of $100,000, according to one of the participants, who asked to remain anonymous to protect client confidentiality.

Not surprisingly, the low bidder won, prompting an angry response from one of the other bidders. “If we went in at $160,000, it would have been low-balling—and dangerously low—but not impossible,” says this person, principal of a small New York design boutique that specializes in interior renovations. “But bidding $100,000 is impossible. … [T]hey won’t make any money.”

The recession has wreaked havoc on the architecture industry in many ways, from a rollback in projects to staff layoffs to declining revenue. One of the most devastating aftershocks, however, has been the practice of fee-cutting, as firms struggle to survive by meeting client demands to save money and tighten budgets.

While no exact numbers are available, architects say fee-cutting is widespread. Scott Kuehn, partner at Denver-based H+L Architecture, an 85-person firm that specializes in healthcare, education, science, and technology, had one long-term client ask for a 10 percent cut on all future work. This client, Kuehn says, “indicated that economic pressure and uncertainties … were driving similar requests to all business partners, suppliers, and vendors.”

For complete article click here.

Instant View: July housing starts rise less than expected

NEW YORK | Tue Aug 17, 2010 9:06am EDT

(Reuters) – U.S. housing starts rose but to a much weaker rate than expected in July, while permits for future home construction fell to their lowest level in more than a year, according to a government report on Tuesday that pointed to a weak housing market.

U.S. producer prices rose in July for the first time in four months, pulled by higher prices for food and consumer goods, a U.S. government report showed on Tuesday.

KEY POINTS:

HOUSING STARTS: * The Commerce Department said housing starts rose 1.7 percent to a seasonally adjusted annual rate of 546,000 units. * June’s housing starts were revised to show an 8.7 percent fall, which was previously reported as a 5 percent drop. * Analysts polled by Reuters had expected housing starts to rise to 560,000 units. * Compared to July last year, groundbreaking activity was down 7 percent. * New building permits, which give a sense of future home construction, dropped 3.1 percent to a 565,000-unit pace last month, the lowest level since May 2009. * That followed a 1.6 percent rise in June and compared to analysts’ forecasts for a slip to 580,000 units.

PRODUCER PRICE INDEX: * The Labor Department said the seasonally adjusted index for prices paid at the farm and factory gate rose 0.2 percent, in line with Wall Street analyst expectations, after dipping 0.5 percent in June. * In the 12 months to July, producer prices increased 4.2 percent after rising 2.8 percent in May. * The year-on-year increase was also in line with forecasts.

COMMENTS:

JOHN CANALLY, INVESTMENT STRATEGIST, ECONOMIST, LPL FINANCIAL, BOSTON:

“The market’s looking for some inflation and we got some on both the core and overall (PPI), which should ease some deflation fears.

“But on the other side of the coin, we had the housing starts data which got a bounce from the prior month, which was expected, but the bounce was a little softer than we thought.

“We’re still getting data post-housing credit that is still weak and not indicative of a market that can sustain itself.

“That ties into a lot of other data recently that has the market worried about a double dip. We still think it’s slow growth rather than a double dip, but each week that passes you tend to get a little more concerned if you don’t get better activity indicators.”

CAMILLA SUTTON, CURRENCY STRATEGIST, SCOTIA CAPITAL, TORONTO:

“It’s a mixed set of data, with a disappointing reading on housing starts and building permits and a slightly stronger PPI report. Actually, at this point some signs of inflation would be soothing to markets amid fears of deflation. But ongoing problems with the housing markets are so great that it will likely offset any positive effect from an increase in prices.” “Forex markets are just taking a breather after the violent swings of last week in euro/dollar and dollar/yen. Traders are still looking for a catalyst to take the dollar in one direction or the other.”

MARK VITNER, SENIOR ECONOMIST, WELLS FARGO SECURITIES, CHARLOTTE, NORTH CAROLINA:

“This is more of a payback from the end of the tax credit. It is not that surprising given the NAHB numbers that were out yesterday which showed really abysmal buyer traffic and expectations for future sales are about as low as they were back before the tax credit was even passed.

 “We had the previous month’s number revised down a little, and we had a nice pop in multi-family, which people kind of forget about because it is so low right now, without that the drop would have been worse.”

BRIAN DOLAN, CHIEF CURRENCY STRATEGIST, FOREX.COM, BEDMINSTER, NEW JERSEY:

“Both these indicators are languishing. It’s nothing new to see the housing market stuck in a rut. On PPI, the core inflation is up a little more than expected year-over-year, which might cause some moderation in U.S. yields. That would help the dollar recover a bit against the yen. But the sentiment out there is there are still problems to come, and with the 10-year yield at 2.60 percent, there’s absolutely no reason for the dollar to rally against the yen right now. We expect another run at 85 yen and then a move to the 84.70-80 area.”

JIM BARRETT, SENIOR MARKET STRATEGIST, LIND-WALDOCK, CHICAGO:

“The slow growth will continue. It perfectly reflects the mood we are in with the under-utilization. We are barely moving forward.”

MARKET REACTION: STOCKS: U.S. stock index futures pare gains after housing, PPI data. BONDS: U.S. Treasury debt prices hold losses. DOLLAR: U.S. dollar remains lower versus euro.

Nonresidential Construction to Grow by 3 Percent in 2011

AIA’s Consensus Construction Forecast predicts a 20 percent-plus decline in nonresidential construction spending through 2010.

According to the semi-annual Consensus Construction Forecast recently released by the American Institute of Architects (AIA), the poor conditions created by a combination of surplus nonresidential facilities, low demand for space, declining commercial property values, and lack of available credit are laying the groundwork for drop of more than 20 percent in nonresidential construction spending this year, despite slight improvements in the overall economy.

Report: Unemployment High Because People Keep Blowing Their Job Interviews

Another applicant blows it by describing his short-term goals as "getting this job."

 WASHINGTON—With unemployment at its highest level in decades, the U.S. Department of Labor issued a report Tuesday suggesting the crisis is primarily the result of millions of Americans just completely blowing their job interviews.

According to the findings, seven out of 10 Americans could have landed their dream job last month if they had known where they see themselves in five years, and the number of unemployed could be reduced from 14.6 million to 5 million if everyone simply greeted potential employers with firmer handshakes, maintained eye contact, and stopped fiddling with their hair and face so much.

“This economy will not recover until job candidates learn how to put their best foot forward,” said Labor Secretary Hilda Solis, warning that even a small increase in stuttering among applicants who are asked to describe their weaknesses could cause the entire labor market to collapse. “If we’re going to dig ourselves out of this mess, Americans need to stop wearing blue jeans to interviews, even if they’re nice blue jeans, and even if that particular office happens to have a relaxed dress code.”

“They also need to start bringing extra copies of their resumés, as it will show they are prepared and serious,” Solis added. “And, by the way, how hard is it to send a hand-written thank-you note afterward? Anyone can dash off an e-mail.”

A federal survey of employers found that nearly half of job-seeking Americans botched their interviews by responding no when asked, “So, do you have any questions for me?” Among candidates strongly qualified to perform the jobs they were applying for, 36 percent didn’t bring a notepad or pen to the interview, and 16 percent were thrown off guard when the interviewer broached topics un≠related to work, such as the weather, sports, or personal hobbies.

Twelve percent, employers said, did this kind of nervous throat-clearing thing.

“If applicants would just say yes when asked if they played softball or liked golf, we could add 350,000 jobs to the private sector,” Deputy Labor Secretary Seth Harris said. “The fact is, right now, today, approximately a third of the country’s manufacturing positions are vacant. Auto plants across the country, especially in Detroit, are sitting there just waiting for people to come in and build cars.”

“You may be a qualified candidate, but none of that matters if you walk into that interview lacking confidence,” he added. “Don’t act too confident, though. And don’t joke around too much. And don’t be overly friendly or ask too many questions. But be yourself.”

The Labor Department confirmed their statistics don’t take into account the estimated 20 million citizens who were unable to get interiews in the first place because of formatting errors in their resumés, or cover letters that slightly exceeded one page.

“At this point, hiring someone who doesn’t use bulleted lists, strong action verbs, or boldfaced keywords is completely out of the question,” said public relations executive Max Werner, who has been looking for office managers and a CFO since 2008. “And if you’re going to end your cover letter with ‘best wishes’ instead of ‘sincerely,’ I don’t care how experienced you are—you won’t be working for me.”

President Obama, who last week signed a law extending unemployment benefits, said the legislation would also address joblessness by creating a $1.2 billion program aimed at training Americans to use firm but approachable body language to make a great first impression.

“My administration remains fully committed to putting citizens back to work by making sure they show up at least 15 minutes early to their interview and never badmouth a previous boss,” said Obama, flanked by unemployed Americans during an address from the White House Rose Garden. “Our new ‘Nail the Interview, Score the Job’ initiative will help regular Americans like Paul and Tracy here remember that they should prep ahead of time by learning a few things about the company they want to work for.”

“And that little things,” he continued, “like making sure your socks match, matter.

Via The Onion

Architects cut hiring

By CHRISTOPHER S. RUGABER (AP)

WASHINGTON — Industries driving job growth this year added fewer workers in June, a sign that the overall hiring picture could get worse.

Manufacturers, for example, added only 9,000 jobs last month, the Labor Department said Friday in its latest monthly employment report. That’s the fewest for the sector this year and below its average monthly gain of 25,400 over the previous five months.

Temporary help firms, meanwhile, added 20,500 positions. That was the smallest gain in nine months.

The two industries have added more than 330,000 jobs so far this year. That’s slightly more than half the total gain in private payrolls of 593,000. As a result, a slowdown in those two sectors could shrink overall job gains in the months ahead.

The declines could be temporary. But in manufacturing, the growth in factory production earlier this year was partly a result of companies restocking their warehouses, after cutting them to the bone in the recession. Many economists worry that production will slow now that the need to replenish inventories is not as great.

Private employers created a net total of 83,000 new jobs in June. That was up from May but not nearly enough to speed the recovery.

Total payrolls fell 125,000, dragged down by the end of 225,000 temporary census jobs. The jobless rate fell to 9.5 percent from 9.7 percent.

Retailers cut 6,600 jobs, the second straight month of losses. That’s a reversal from earlier this year, when stores began hiring again after a strong winter holiday shopping season.

The renewed job losses are a sign that merchants aren’t seeing a strong rebound in consumer spending.

Other industries that are hurting could get worse. Jobs in architecture declined, a sign that fewer commercial building will be designed, said Ken Simonson, chief economist at the Associated General Contractors of America.

That could lead to more job cuts in construction. The industry lost another 22,000 positions in June. That leaves about 5.6 million people employed in the construction industry, the lowest level in almost 14 years, Simonson said.

These and other details can be found in the government’s latest jobs report.

‘Masterpieces’ on hold, waiting for better times

Hat tip to CNN Living

This article focusses on the job market as well.  Give it a read.

Aqua Building, Chicago, IL.

Some stunning buildings have appeared in American cities the past four years — buildings, like the Aqua skyscraper in Chicago, Illinois, that attest to the creativity of 21st-century architecture.

But there might be fewer of them in the near future, because the recession has forced many architects to tone down their ambition.

“A lot of projects have been delayed, a lot of projects have been scaled back, a lot of projects have been scrapped. … It’s not a time to see a lot of architectural masterpieces being created,” said Kermit Baker, chief economist of the American Institute of Architects.
 
Baker said the emphasis today is on value.

 “I think most buildings that are being built are very much focused on managing cost,” he said. “So you tend to see less creativity in that environment, less exciting designs, less upscale materials being used in them.”

 At Aqua, the curved terraces vary slightly from floor to floor, giving the 82-story tower a soft, billowy look — as though Chicago’s celebrated winds are ruffling its façade. It’s an award-winning structure that stands out for its innovative design by Studio Gang Architects. But its construction was well under way before the recession.

 Now “we are hearing that there’s more renovation work than construction work — kind of retrofitting existing buildings rather than building new ones,” Baker said.

It’s really difficult … for students coming out of school to find appropriate positions … we’re afraid that we’re going to lose a generation of architects.
–George Miller, president of the American Institute of Architects

It might not be the most stimulating work for innovative minds, but at least it’s work in what industry experts say has become an intensely competitive market. Where there were once two or three firms competing for a small project, now there are 20 or 30 as larger firms move in to take whatever jobs they can get.

The larger firms might “rather do a skyscraper, but if they can get a much smaller job they will, to keep the firm going and to keep people employed,” said Robert Campbell, a free-lance architecture critic for The Boston Globe. “And that drives people out of the field at the bottom who would otherwise have been getting those small jobs.”

Many firms have had to lay off employees to stay afloat. According to the U.S. Bureau of Labor Statistics, employed architects have dropped from an average of 233,000 in the first quarter of 2008 to 217,000 in the first quarter of 2009 and 198,000 in the first quarter of 2010.

George Miller, the president of the AIA and a partner at world-renowned architecture firm Pei Cobb Freed & Partners, worries about the long-term effects this job shortage will have on the industry.

“It’s really difficult, of course in these last several years, for students coming out of school to find appropriate positions in the field,” he said. “That really concerns all of us because we’re afraid that we’re going to lose a generation of architects.

… There are going to be fewer of us around to do the work that really needs to be done in the future.”

What will be the architectural work of the future? Miller says it will likely be energy-efficient design and a renewed focus on infrastructure, especially in urban areas.

“We’re going to be considering not only the individual building solution, but also the way in which our buildings fit in neighborhoods and communities and regions,” he said. “We really have to have a plan now that considers the infrastructure of our communities. … I think if we’re smarter in terms of designing our urban centers, we’ll be more efficient in terms of the utilization of our natural and physical resources.”

Experts agree that architecture is a cyclical industry and that the market will eventually rebound. The question is when.

“It’s always been highs and lows, highs and lows,” said Campbell, who is also a registered architect. “I remember in 1975 I was working for a prominent firm in Harvard Square, and we dropped from 68 [employees] to 20. And that was the oil embargo, ’74, and that led to an extremely steep recession but a short one — not like this one that’s lasted so long.”

Some architects think recovery might be around the corner.

“We are seeing the private sector picking up,” said Thomas Fridstein, head of global architecture for AECOM, a provider of technical and management support services. “I feel like we’ve been through the worst, we’ve sort of hit the trough of the recession and things are on the upturn. We’ve had some major commercial clients contacting us about projects potentially starting up again, so that’s a very positive sign.”

It’s a positive sign for the nation, too, because busy architects are a bellwether of economic stability.

“If you don’t design it, you can’t build it,” Baker said. “So [architects] are really the first step in the process toward seeing a recovery.”