Architectural Services

The 21,294 Architectural services firms in the US are responsible for designing places for people to live, work, worship, learn and play. 83% of firms have nine or fewer employees. Most firms gain a significant portion of their revenue (about 81% on average) from non-residential services.

Technology Levels the Playing Field

Building Information Modeling, or BIM, has become the industry standard for projects of all sizes, because it facilitates the communication of design and construction plans across all project participants.

Green Building Supports New Development

The government has helped fuel the green building surge by providing a variety of incentives for firms and contractors who build with energy efficiency and use renewable energy.

Aug 23, 2026 - Backlogs Suffer for Firms without Data Center Contracts

• The Associated Builders and Contractors (ABC) Construction Backlog Indicator fell 0.8 months to 8 months in July 2026 compared to June. The commercial and institutional backlog fell 0.9 months in June to 8 months and was down 1.2 months compared to June 2025. ABC Chief Economist Anirban Basu said July's construction backlog was the lowest since January, and that strong demand for data centers was obscuring the overall weakness of the construction sector. Backlogs are smaller for firms that are not under contract for data center work. For the 88% of firms without a data center contract, backlogs average 7.5 months, compared to 11.4 months for construction firms with data center contracts.
• US construction and engineering spending is expected to decline 1% in 2026 after remaining flat in 2025, according to FMI's third-quarter 2026 North American Engineering and Construction Outlook. Office construction is projected to grow 2%, with a 21% increase in data center spending offsetting continued weakness in traditional office construction. Amusement and recreation (+2%), transportation (+1%), and communication (+3%) also remain stable. Several building segments are expected to decline, including lodging (-9%), commercial (-5%), health care (-0.2%), education (-1%), and public safety (-4%). Manufacturing construction is forecast to fall 17% as semiconductor fabs and battery plants move beyond their most spending-intensive phases. Residential construction remains constrained by elevated mortgage rates and affordability pressures. Single-family spending is projected to drop 4%, while multifamily spending declines 1% as rents remain soft and concessions limit new development. Residential improvements are expected to rise by 5%, supported by home equity financing and inflation in renovation costs.
• Multifamily developer confidence weakened in the second quarter of 2026, according to the National Association of Home Builders’ (NAHB) latest Multifamily Market Survey. The Multifamily Production Index (MPI) dropped three points to 43 compared to the second quarter of 2025. The Multifamily Occupancy Index (MOI) decreased by 8 points to 74 over the same period. An MPI or MOI reading of 50 or more indicates that multifamily production or occupancy, respectively, is growing. Multifamily developers’ headwinds include volatility in building materials costs, high interest rates, and regulatory difficulties. While the NAHB expects the recently enacted 21st Century ROAD to Housing Act to help alleviate some of the building industry's challenges, the law's policies will take time to implement.
• Demand for building design services declined in July 2026 from the prior month, as architectural billings remain soft, according to an August report by the American Institute of Architects (AIA). The AIA’s Architecture Billing Index (ABI) fell to 46.6 in July from 47.3 in June. Any reading of 50 or more indicates growth in architectural billings. The score for new project inquiries dropped to 52.6 in July compared to 56.1 in June, and the index for the value of new design contracts decreased from 49.8 to 47.2. The AIA’s Chief Economist, Richard Branch said, "Macroeconomic uncertainty continues to weigh on the built environment. High oil prices are putting upward pressure on inflation and may lead to even higher rates in the back half of the year. This will put additional pressure on developers and may lead to a further weakening in billings."

Industry size & Structure

The average architectural firm has about 10 employees and generates $2.3 million in annual revenue.

• The industry has 21,258 firms with $48.7 billion in annual revenue and 204,000 employees.
• Sole employee firms tend to work from home-based offices in order to defray overhead expenses. Most other small to medium firms work from leased office space.
• The industry is highly fragmented with the 50 largest firms representing just 22% of industry revenue.
• Large firms in the US include HOK, William Rawn Associates, and Skidmore, Owings and Merrill (SOM).