Building architecture industry

Industry Snapshot

GENERAL INDUSTRY: Architecture and Construction

CAREER CLUSTER: Architecture and Construction

SUBCATEGORY INDUSTRIES: Architectural Consulting Services; Architectural Design Services; Architectural Services; Drafting Services

RELATED INDUSTRIES: Building Construction Industry; Landscaping Services

ANNUAL DOMESTIC REVENUES: US$54.1 billion (IBISWorld, 2023)

NAICS NUMBERS: 54131, 54134

Summary

The architecture industry’s primary purpose is to design structures for human habitation and use. This broad field of design includes new construction, renovations, and additions. Common types of architect-designed buildings include those housing offices, retail businesses, hospitality providers, industrial businesses, educational institutions, health care providers, government offices and facilities, religious congregations, cultural facilities, recreational facilities, and transportation resources, as well as residential properties. Although the practice of architecture centers on the act of design rather than construction, architects may administer the bidding process among construction companies, help select contractors, and verify through site visits that construction is proceeding according to plan. Architects typically work with professionals in related disciplines, who may or may not work within the same firm as the architects. These related disciplines include but are not limited to interior design, planning, landscape architecture, plumbing, and structural, civil, mechanical, and electrical engineering.

History of the Industry

The distinction between building designers and building constructors is very old. An early example of a building designer not directly involved in construction is Imhotep, whose designs for early Egyptian pyramids date from the third millennium BCE. In the civilizations of antiquity, architects designed structures requiring advanced skills and knowledge—such as the buildings populating the Athenian Acropolis, most famously the Parthenon—and public and military buildings found throughout the Roman Empire, most famously the Roman Coliseum. These projects required thoughtful application of proportion and geometry along with knowledge of construction trades.

Architects cater to the values and needs of each civilization; thus, as world civilizations grew larger and more diverse, building designers adapted with a broadening array of building types. For example, the expansion of the Roman Empire brought about the introduction of concrete, standardization of vaults, and new building types such as circuses, baths, and apartments. Building designers developed buildings to meet new user demands; early Christian churches were initially similar to earlier Roman structures but were later modified to incorporate larger spans and various functional subspaces useful to Christians, including naves and apses. Throughout history, building designers helped create new types of buildings and implement new construction methods.

The architecture industry transformed rapidly during the Industrial Revolution in response to new means of construction and fundamental shifts in patterns of urbanization and industry. In contrast to the more limited construction methods used since the fall of the Roman Empire, industrial-age architecture incorporated iron and reintroduced concrete. In less than two centuries, innovations such as reinforced concrete, float glass, and reliable elevator technology further expanded the options open to designers. The task of housing people in increasingly dense urban locations resulted in new master plans for entire cities and the introduction of modern zoning methods. The challenge of adapting to these changes led to rapid expansions in the architecture industry.

Partly in response to the sweeping changes of the eighteenth through the twentieth centuries, design professionals such as architects and engineers required increasing knowledge of a growing body of construction methods, published building standards, and building typologies in order to serve the public. The increased knowledge necessary for such professions, as well as the potentially fatal consequences of incompetence, led governments to adopt formal standards of education, examination, and licensure in the twentieth century. In response to public demands for fire safety, building accessibility to mobility- and sight-impaired people, and reduced environmental impacts, the architecture industry has accrued a vast quantity of shared professional knowledge. Civilizations continue to change, and the architecture profession continues to keep pace with these changes. An industry that once catered almost exclusively to the wealthiest and most powerful clients has come to cater to the diverse needs of the general public.

The Industry Today

The focus of the architecture industry remains what it has been throughout the history of the profession: designing buildings and administering designs during construction. While that focus remains the same, however, the range of modes in which architects and engineers practice is growing larger. A modern building designer could design a department store as an employee of a large corporation, examine plans for a city government, lead a design department in a design-build firm, provide specialized design-support services for another designer in a large architecture firm, counsel a homeowner on a small remodeling project, or perform any other function that capitalizes on architects’ and engineers’ educations.

The exact manner in which architectural firms practice today is changing in response to several ongoing trends. Changes influencing the architecture industry today include the following:

• Promulgation of corporate architecture

• World population growth

• Market volatility

• Transformations in information technology

• Environmental concerns

• Formalization of architect licensure requirements

These trends are discussed in the subsections below to help illuminate the status of the architecture industry and the steps being taken in response to industry trends.

Modern corporations have transformed the built environment the world over. Buildings built for large companies such as Walmart are spaced thousands of miles apart but often contain identical functional and aesthetic elements. The desire to display corporate power encourages architects, builders, and engineers to work together to design and build ever-taller habitable structures, such as Chicago’s Willis Tower. To better cater to the needs of large clients, including corporations, the architecture industry is evolving to include specialists serving individual corporations. These specialized architects, if they attain efficiency within their niche, may provide price incentives in the form of reduced professional fees in relation to overall construction costs.

Professionals catering to large corporations may offer services including project management, facilities management, engineering, and environmental planning. Larger firms, rather than interacting with engineers or contractors in separate companies, may include all of these elements under one roof. Design-build firms, which provide both design and construction services, are examples of this ongoing trend. For clients, the consolidation of the multiple disciplines involved in building construction has in many cases simplified the process of hiring building-related professionals.

Increasing world population, especially when coupled with increased per capita income and availability of credit, promotes construction of new buildings and renovations of existing buildings. Market volatility in the late twentieth and early twenty-first century has affected the way many architecture firms do business. Firms today often use part-time, contract, or temporary staff to handle surges in consumer demand when it is unclear how long such surges will last. Increasingly, construction documentation and other services are being contracted to foreign firms to diminish the costs and risks associated with retaining a large workforce of permanent employees. In years of strong economic growth, the proportion of bonus or overtime pay architects receive is higher than the proportion of such pay received by professionals in other industries; overtime pay allows firms to employ smaller workforces, and bonus compensation can be reduced in the event of a downturn.

As recently as 1980, most firms relied on hand-drafting to produce project documents, but today the majority of this work is performed using computer modeling and drafting. Computer-aided design (or computer-aided drafting, CAD) has increased efficiency. New modeling software enhances architecture firms’ ability to educate clients about proposed building plans. Some types of buildings, such as the museums designed by Gehry Partners in the 1990s and the early twenty-first century, would have been impossible to design and build without state-of-the-art computer modeling technology. The industry is rapidly adopting building information modeling (BIM) systems that allow architects to create intelligent models of buildings that automatically coordinate design documents, assist in engineering coordination, and recalculate values in schedules. Internet marketing, including that conducted through social and professional networking sites, blogs, and firm websites, plays a role of increasing importance in attracting new clients and employees.

Environmental concerns encourage a new set of priorities for clients and designers. Through a variety of channels, the public is becoming increasingly aware of burgeoning landfill waste caused by construction industry by-products, airborne contaminants emitted by construction materials and their manufacture, building-related energy usage, and habitat destruction caused by extraction of building materials and redevelopment. Some organizations, such as the International Code Council, have updated published building standards to promote sustainability in building construction and operation. Architects serve as advisers to such organizations, and many of these revised standards are enforced legally. An increasing number of architects seek additional training and accreditation through the Leadership in Energy and Environmental Design (LEED) programs offered by the US Green Building Council. Organizations such as LEED promote public awareness through building certification programs.

Partly in response to code revision, building typology expansion, and innovations in construction methodology, all fifty states have increased their formal requirements for architect licensure during the last century. For most architects, these requirements include accredited postsecondary professional degrees, internships, and examinations. In 2023, the National Architectural Accrediting Board (NAAB) listed 175 accredited architecture programs across the United States that offer a variety of doctoral, master’s, and bachelor’s degrees. Such programs typically take four to eight years to complete. Traditionally, a large share of architect training has been the responsibility of firms, which provide internships for rising architecture students and recent graduates. Over the last few decades, internships have largely been administered by the National Council of Architectural Registration Boards (NCARB).

NCARB requires that all architectural interns enrolled in its program, which typically takes three or more years to complete, gain requisite experience in several different categories of architecture, including document creation, cost estimation, specification design, coordination with other design professionals, and administration of contracts during construction. The seven-part Architect Record Examination covers various subject areas. Each part requires a solution to a design problem, and six of the parts pose other questions in addition to these problems. Many state jurisdictions require further procedures to verify architectural skills, such as oral tests, written tests, or continuing education after initial licensure. Continuing education is also required by professional organizations such as the American Institute of Architects (AIA).

Industry Outlook

Overview

According to the AIA, the architecture industry as a whole experienced approximately 6 percent annual growth from 2003 to 2005, with slower growth from 2006 to 2008. Outsourcing to foreign architecture firms has affected the domestic employment rate of architects, and architects entering the field have experienced fierce competition for positions in top-tier firms, even during the height of the 2005–7 construction boom.

The period immediately following that boom was relatively difficult for the building architecture industry. The recession acutely affected the construction industry, and architecture firms saw dramatic changes in employment, earnings, and sources of revenue as a result of diminished construction activity. According to the AIA, nearly as many architectural jobs were lost between 2007 and mid-2009 as were gained between 2002 and 2007. The difficulties faced by the architecture industry were by no means isolated to the United States. According to the International Labour Office, the worldwide average rate of growth in gross domestic products slowed from 3 percent in January 2008 to –1.4 percent in July 2009. This slowdown strongly affected the global architecture industry, though its effects were by no means uniform.

Between 2012 and 2013, the industry began to gradually recover. The US Bureau of Labor and Statistics (BLS) reported that in May 2012, there were approximately 82,720 employed architects, excluding landscape and naval architects, and 83,410 architectural and civil drafters; by May 2013, that number had increased to 84,210 architects and 88,860 drafters. The long-term prospects for architecture firms are positive. The BLS reported that in 2023, there were 123,700 architects, excluding landscape and naval architects. The steady increase in world population coupled with the imminent retirement of the baby-boomer generation will fuel demand for health-care facilities, nursing homes, and other building types. In general, the long-term prognosis for the industry is very good.

Employment Advantages

The benefits of a career in architecture are many. Architects enjoy a wide variety of potential responsibilities, as well as opportunities for creativity and mental stimulation. Every project provides new and interesting challenges. Most architects enjoy professional work environments that are safe and comfortable, while also traveling to construction sites occasionally to observe and help oversee the realization of their visions.

A career in architecture is a good choice for a candidate who enjoys cultivating diverse skills. Architecture is a constantly changing industry that responds to shifts in the means of construction, costs of resources and energy, demographics, building uses, geographic patterns of human habitation, building law, and human ecology. An architect may reasonably expect the unexpected, and a well-qualified candidate should be adaptable and amenable to a lifetime of learning opportunities.

Annual Earnings

According to the research firm IBISWorld in July 2023, the architecture industry in the United States earned annual revenues of $54.1 billion. This figure does not include the earnings of engineering firms, interior design companies, or architects working in other industries, such as those serving as inspectors or administrators in public offices. It also does not include design work performed by builders as part of construction projects that are not required to be designed by architects.

The architecture industry has a steadily changing relationship with the related engineering and construction industries, as architects, engineers, and builders seek new forms of partnership with one another. The earnings of the architecture industry could theoretically change not only as a result of public demand for new and reconfigured buildings but also as a result of shifting proportions of buildings designed by engineers and contractors or expansion of services performed by architects.

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