Autos vs. Architecture

For weeks now the Obama campaign has been running an ad about 1M auto industry jobs saved. It’s an effective ad, but every time I see it I can’t help but think about the struggles in the building design and construction industry. One million jobs saved, but how many jobs lost? The ad also says that 4.2M jobs have been created. Certainly that is positive. Many of those are new start-ups and companies getting back on their feet. Still—design and construction—not so much.

According to the Bureau of Labor Statistics 3,926,000 jobs have been lost from the construction industry and only 186,000 have been created or only 4% of the 4.2M new jobs. According to Kermit Baker, AIA’s chief economist, at his recent AIA Convention address, US architecture firm jobs are down by 608,000 from a 2007 high of 2,141,000 or 28%, landscape architecture jobs by 34%, and interior design jobs by 31%. More jobs have been lost in design and construction than have been created nation-wide.

With the exception of engineering, nearly 1 in 3 individuals employed in the building design industry prior to the economic downtown is without work. Baker also noted that these industries hit bottom in early 2010 and have stayed there. By 2015 the industry is only projected to return to it’s 30 year average of 1.3B square feet of construction, which is well below the boom years.  This sense of caution is consistent with nearly every design firm leader I speak with—2011’s optimism has given way to a healthy dose of skepticism. Although, the Architectural Billings Index has mostly been up this year, it has yet to prove sustainable.

The mechanisms needed to restore the building design and construction industry, formerly comprising 10% of GDP ($1.56T in today’s dollars), are not present. Stimulus money for shovel ready projects created an infusion of dollars to temporarily maintain jobs that were ultimately lost. The stimulus simply wasn’t designed to build long-term sustainable business models.

So what’s next for our industry that has been such an important contributor to GDP in the past? Building design and construction is an indicator of our health as a nation. Simply put, when things are good, we build things and we fix things. Growth produces demand and our GDP is built on supply and demand. How do we create a sustainable future built on growth models that provide on-going opportunities, for those employed, unemployed and still in school? The answers are complicated, but the goals should be simple.

The AIA put forth a plan for economic recovery based on: removing barriers to private sector lending, saving energy – creating jobs, helping small firms grow, and revitalizing America’s neighborhoods. All are important ideas, but the plan doesn’t go far enough. It relies too heavily on basic ideas and technologies that exist today and doesn’t challenge our industry and our legislators to promote innovation and new technologies and the financing mechanisms to make it happen.

Congratulations to the auto industry—now what about the rest of us? We need to create our future now. It takes a lot of car sales to produce $1.56T in GDP.