Billable hours retreat, while inquiries for new work and hiring plans jump.

5/22/2018—Business conditions for the first quarter of 2018 reflected a mixed picture for landscape architecture firms, according to a new American Society of Landscape Architects (ASLA) Business Quarterly survey. Leading indicators in the survey remained generally positive—inquiries for new work and plans to hire jumped. But billable hours dipped.

A five-year comparison of survey results shows that numbers for the first quarter are well within range and even surpassing some previous trends.

The survey found 75.3 percent of responding firms reported stable to significantly higher billable hours for the first quarter of this year, a drop from the 82.4 percent from the fourth quarter of 2017. The result is well within range of what had been reported for the first quarters of 2017 (75.8 percent). 2016 (80.8 percent), 2015 (82.0 percent) and 2014 (72.0 percent). This comparison suggests that the drop in billable hours for the first quarter of 2018 may be just a temporary deviation.

The numbers were brighter for inquiries for new work—85.1 percent of respondents said their firms received stable to significantly higher inquiries, which is an increase over the 84.8 percent reported for the fourth quarter of 2017. This number is well within range for what had been reported for the first quarters of 2017 (85.4 percent), 2016 (80.4 percent), 2015 (85.3 percent) and 2014 (80.2 percent).

The survey found that year to year, 78.3 percent of firms reported that billable hours were stable to significantly higher, a jump from what had been noted for the first quarter of 2017 (73.3 percent). This number is higher for the year-to-year reporting from 2016 (75.7 percent), and 2014 (76.0 percent). It is less than what had been reported for the first quarter of 2015 (80.5 percent).

Year to year, 84.7 percent of respondents said that first quarter inquiries for new work were stable to significantly higher, about the same as what had been reported for the first quarter of 2017 (84.1 percent). It is higher than what had been reported for the first quarters of 2016 (81.1 percent), 2015 (83.2 percent) and 2014 (83.4 percent).

Some 66 percent of responding firms with two or more employees said they plan to hire during the second quarter of 2018, a noticeable jump from the fourth quarter of 2017 (60 percent). This number is a five-year high—greater than what had been reported for 2016 (59.4 percent), 2015 (61.5 percent) and 2014 (49.4 percent).

Some 80.0 percent of firms with 100 or more employees said they will hire either an experienced landscape architect or entry-level landscape architect.

In addition, the survey asked respondents several questions about their firms’ marketing practices. The majority of firms spent less than 5.0 percent of their budgets on marketing. Fully 37.9 percent spent 2.0 to 5.0 percent, and 34.5 percent spent less than 2.0 percent. Only 2.9 percent said they spent more than 12 percent of their budget.

The majority of respondents (48.9 percent) said their firms employed a dedicated marketing person, with the second most popular answer, “Other,” garnered 42.1 percent of responses. Most firms (81.3 percent) did not regularly send email newsletters to actual and prospective clients. Likewise, the majority of firms (72.3 percent) did not offer an email signup form on their websites.

The majority of firms (64.6 percent) said they use 3D-visualization and -modeling tools to make compelling presentations to prospective clients and manage client expectations. Fully 78.3 percent also said their firms encourage staff to become involved with community groups in alignment with their target markets.

Key Survey Highlights:

Compared to the fourth quarter 2017, your first quarter 2018 billable hours were (all firms):
Significantly higher (more than 10%)     –15.5%
Slightly higher (5% to 10% higher)     –31.0%
About the same (plus or minus 5% or less)     –28.7%
Slightly lower (between 5% and 10% lower)     –16.1%
Significantly lower (more than 10%)     –8.6%

Compared to the fourth quarter 2017, your first quarter 2018 inquiries for new work were (all firms):
Significantly higher (more than 10%)     –17.7%
Slightly higher (5% to 10% higher)     –38.9%
About the same (plus or minus 5% or less)     –28.6%
Slightly lower (between 5% and 10% lower)     –8.0%
Significantly lower (more than 10%)     –6.9%

Year to year, compared to the first quarter in 2017, your first quarter 2018 billable hours were (all firms):
Significantly higher (more than 10%)     –13.1%
Slightly higher (5% to 10% higher)     –42.3%
About the same (plus or minus 5% or less)     –22.9%
Slightly lower (between 5% and 10% lower)     –16.0%
Significantly lower (more than 10%)     –5.7%

Year to year, compared to the first quarter in 2017, your first quarter 2018 inquiries for new work were (all firms):
Significantly higher (more than 10%)     –13.1%
Slightly higher (5% to 10% higher)     –42.6%
About the same (plus or minus 5% or less)     –29.0%
Slightly lower (between 5% and 10% lower)     –-10.2%
Significantly lower (more than 10%)     –5.1%

Do you plan on hiring any employees in the second quarter of 2018 (multiple answers filtered for firms with two or more employees)?
Yes, we'll be hiring an experienced landscape architect     –13.9%
Yes, we'll be hiring an entry level landscape architect     –33.3%
Yes, we'll be hiring an intern     –26.4%
Yes, we'll be hiring support staff     –9.7%
Yes, we'll be hiring other design/architecture/engineering staff     –10.4%
Yes, we'll be hiring other staff     –13.2%
No, we're currently not hiring     –34.0%

What percentage of your budget goes to marketing?
Less than 2%     –34.5%
2%-5%     –37.9%
6%- 9%     –13.8%
10%- 12%     –10.9%
Over 12%     –2.9%

How do you handle your marketing needs?
Dedicated staff member(s)     –48.9%
Outside firm     –9.1%
Other     –42.1%

My firm sends out a regular email newsletter to our client base and interested prospects.
Dedicated staff member(s)     –48.9%
Outside firm     –9.1%
Other     –42.1%

My firm sends out a regular email newsletter to our client base and interested prospects.
Yes     –18.8%
No     –81.3%

My firm has an email signup form on our website.
Yes     –27.8%
No     –72.3%

My firm uses 3D-visualization and -modeling tools to make compelling presentations to prospective clients and manage client expectations.
Yes     –64.6%
No     –35.4%

My firm encourages our staff to become involved with community groups in alignment with our target market.
Yes     –78.3%
No     –21.7%

About the Survey

The American Society of Landscape Architects (ASLA) Business Quarterly survey asks quarterly benchmarks on key statistics including billable hours, inquiries and hiring plans. The survey is not intended to be statistically significant but instead provides a snapshot of the landscape architecture industry. The Q4 2017 national survey was fielded May 3 to May 17, 2018, with 176 primary firm contacts responding.

About ASLA

Founded in 1899, the American Society of Landscape Architects (ASLA) is the professional association for landscape architects in the United States, representing more than 15,000 members. The Society’s mission is to advance landscape architecture through advocacy, communication, education and fellowship. Sustainability has been part of ASLA’s mission since its founding and is an overarching value that informs all of the Society’s programs and operations. ASLA has been a leader in demonstrating the benefits of green infrastructure and resilient development practices through the creation of its own green roof, co-development of the SITES® Rating System, and the creation of publicly accessible sustainable design resources.