{"id":744580,"date":"2024-06-25T08:30:13","date_gmt":"2024-06-25T07:30:13","guid":{"rendered":"https:\/\/www.architectsjournal.co.uk\/?p=744580"},"modified":"2024-06-25T08:34:43","modified_gmt":"2024-06-25T07:34:43","slug":"aj100-survey-shows-income-rising-but-confidence-sliding","status":"publish","type":"post","link":"https:\/\/www.architectsjournal.co.uk\/news\/aj100-survey-shows-income-rising-but-confidence-sliding","title":{"rendered":"AJ100 survey shows income rising but confidence sliding"},"content":{"rendered":"
\n

The AJ100 Index<\/h3>\n

Subscribers can rank, read and compare AJ100 practices\u2019 financial figures and business data \u2013\u00a0 including fee income, staff numbers and percentage of female architects \u2013 from 2011 onwards. Click here<\/a> to view the AJ100 Index.<\/p>\n<\/div>\n

The findings of the latest AJ100 survey suggest that the strong bounce-back from the pandemic may be starting to falter. As well as a slight fall in the numbers of architectural staff, including, noticeably, architectural assistants, overall confidence is on the slide. Yet it\u2019s a mixed picture, with architectural fee income well up and signs of increased diversity.<\/span><\/p>\n

There are other telling changes. Almost all practices now mandate a quota of days in the office. B Corp certification is gaining momentum and the use of AI has sky-rocketed.<\/span><\/p>\n

Our thanks to Bruce Tether, professor of management at the Alliance Manchester Business School, University of Manchester, for his analysis of the data.<\/span><\/p>\n

\"\"<\/p>\n

Overview<\/h3>\n

While the UK\u2019s largest practices are employing more architects than ever, a\u00a0fall in the number of architectural assistants suggests confidence may be waning<\/em><\/p>\n

The latest AJ100 data presents a mixed picture. While the number of architects employed within the rankings has increased slightly to another all-time high (7,499), there are some signs that confidence may be on the\u00a0wane.\u00a0<\/span><\/p>\n

The headcount of all architectural staff at AJ100 practices dipped by 160 to 13,175 in 2023, compared with a 6 per cent rise the previous year. Perhaps tellingly, the number of architectural assistants employed fell \u2013 with Part 2 numbers down by 9 per cent and Part 1 by 4 per cent after big rises the previous year.\u00a0<\/span><\/p>\n

Five practices (ADP, AWW, JTP, Maber, Ridge & Partners) closed offices compared with none the year before, while eight opened new ones, two fewer than in 2022.<\/p>\n

Optimism levels, meanwhile, are drifting downwards \u2013 with 55 per cent of practices describing themselves as optimistic (to some degree), down from 62 per cent in 2022 and a peak of 86 per cent in 2021. Yet aggregate architecture fee income to UK offices was up almost 10 per cent to \u00a31.65 million \u2013 the second double-digit rise in a row.<\/p>\n

Top-ranked practice Foster + Partners now accounts for almost 16.5 per cent of the total fees reported by AJ100 practices after increasing architectural fee income by 27 per cent in 2023.<\/p>\n

Fosters and BDP remain the largest \u2018pure\u2019 architecture practice employers, with 1638 (+106) and 942 (+84) permanent employees respectively.<\/p>\n

Total permanent employment including non-architectural staff rose by 10.5 per cent to 41,139. But, as ever, this figure is heavily influenced by a few large multidisciplinary businesses: AECOM (7,346), Arup (6,000), Jacobs (10,000).<\/p>\n

The data reveals other significant changes. There has been a rise in diversity, with the number of architects from an ethnic minority employed by AJ100 practices up by 12 per cent.\u00a0<\/span><\/p>\n

Pursuit of B Corp accreditation is now well-established among the UK\u2019s largest practices, with 30 of the AJ100 either accredited or in the process of accreditation less than four years after the first UK practice achieved this status.\u00a0<\/span><\/p>\n

\"\"<\/p>\n

It is also now customary for AJ100 practices to measure their carbon footprint \u2013 89 per cent are now doing this compared with 49 per cent four years ago. Almost half of these practices measured Scope 1,2,3 emissions including the emissions of their own projects.<\/p>\n

For the first time, the survey collected data on regenerative\/net positive design. This is explored by 55 per cent of AJ100 practices.<\/p>\n

Hybrid working arrangements are increasingly formalised, with 94 per cent of practices requiring staff to be in the office for a minimum number of days, up from 73 per cent the previous year. By far the most usual number of days required is three (56 per cent).<\/p>\n

Practices have become less generous in making one-off payments to compensate employees for higher energy bills \u2013 only 15 per cent of respondents did so in 2023, compared with 38 per cent who made such payments in 2022.<\/p>\n

The AJ100 cohort is fast embracing AI and machine learning, which is now used to some extent by 86 per cent of practices compared with 44 per cent the previous\u00a0year.<\/p>\n

Brexit-related recruitment conditions remain a factor, albeit slightly diminishing. Twenty-seven practices reported that their recruitment had been impacted significantly and another three severely (compared with 32 and four the previous year, respectively). Increased costs of visa sponsorship and a smaller pool of candidates were cited as common issues among those reporting problems.<\/p>\n

\n

Top 10s<\/h3>\n

Which practices earn the most from UK-based architecture projects, employ the most architectural staff, and employ the most architects overseas?<\/em><\/p>\n

\"\"<\/p>\n

Top-ranked Fosters continues to expand its architectural headcount, piling on another 67 staff members in the UK. While BDP (up 11), AECOM (up 47) and Allies and Morrison (up 25) also grew their architectural numbers, several highly placed practices experienced declines, including Allford Hall Monaghan Morris (down 83), Zaha Hadid Architects (down 40) and Sheppard Robson (down 22).<\/p>\n

However, when it comes to fees from UK projects paid to UK offices, BDP continues to be the highest earner, followed once again by Allford Hall Monaghan Morris and tp bennett, with Fosters in fourth position.\u00a0<\/span><\/p>\n

Perkins&Will drops to second place in the rankings for number of architects employed by AJ100 practices overseas, despite adding another 114 during 2023. The new leader is multidisciplinary firm AECOM, which did not reveal figures last year. Also expanding are Populous (up 50); Jacobs (up 29), AtkinsR\u00e9alis (up 18) Grimshaw (up 15) Chapman Taylor (up 13) and Aukett Swanke (up 11).<\/p>\n

\"\"<\/p>\n

\n

Diversity<\/h3>\n

Ethnic-minority representation in AJ100 practices continues to gain momentum while the proportion of women architects has edged up<\/span><\/em><\/p>\n

The AJ100\u2019s journey towards greater ethnic diversity is beginning to gain some momentum. In 2023, 14.8 per cent (1,111) of the architects at AJ100 practices were from ethnic minorities, according to the 98 practices that supplied these figures. This compares with 13.4 per cent the previous year (993) and 11 per cent five years ago (727).<\/p>\n

The figure compares favourably with ARB statistics, which report that 12 per cent of all registered architects in the UK are non-white, suggesting greater diversity among larger practices. For the UK population as a whole, the figure is 17 per cent.<\/p>\n

There is wide diversity in the extent of employment of ethnic-minority architects in the AJ100 practices.\u00a0 <\/span>Ethnic-minority architects account for more than a third of architects in five practices (DB3 Group, Zaha Hadid Architects, Stephen George + Partners, Perkins&Will and PLP Architecture), and at least a quarter in eight more. \u00a0<\/span><\/p>\n

On the other hand, four practices reported employing no architects from an ethnic-minority (Bryden Wood, GT3, LSI, P+HS), and another five only one.<\/p>\n

\"\"<\/p>\n

There has been a slight increase in the representation of women architects \u2013 these now account for 2,760 (36.8 per cent) of all architects employed in the UK within the cohort, marginally higher in both absolute number and in proportion compared with the previous year (2,661, 35.9 per cent). This benchmarks well against ARB statistics, which report that 31 per cent of all architects on its register are women.<\/p>\n

Women make up the majority of the architects employed at seven AJ100 practices (Darling at 59 per cent, ECD at 57 per cent, Architype at 55 per cent, PLP at 54 per cent, Oberlanders at 53 per cent, Jestico + Whiles at 52 per cent and Hyphen at 51 per cent). \u00a0<\/span><\/p>\n

This is, however, down on nine practices the previous year. There is considerable variance overall \u2013 in five practices, fewer than one in five architects is a women, and in two, it is only one in ten (Associated Architects and Hadfield Cawkwell Davidson).\u00a0<\/span><\/p>\n

\n

Sustainability<\/h3>\n

AJ100 practices are edging very slowly towards greater sustainability, increasing their in-house specialists, particularly Passivhaus designers<\/em><\/p>\n

AJ100 practices are making\u00a0 <\/span>limited progress on developing more sustainable practices, despite the urgency of the climate crisis.\u00a0<\/span><\/span><\/p>\n

Among the more marked changes is the proportion of practices measuring their carbon footprint. This now stands at 89 per cent, compared with 78 per cent the previous year.\u00a0 <\/span>Of these, almost half (48 per cent) said this calculation measured Scope 1,2,3 emissions, including those of their own projects.<\/span><\/p>\n

There was also a significant increase, from 80 to 85 per cent, in practices claiming to have a specific approach to delivering sustainability that is used on their built projects. Sustainability R&D is more prevalent, with 83 per cent having engaged in this in 2023 compared with 77 and 72 per cent the two previous years. Just over half (55 per cent) reported having explored\/researched aspects of regenerative\/net-positive design in 2023, while 86 per cent said they were incorporating aspects of adaptation and resilience in their projects.<\/span><\/p>\n

\"\"<\/p>\n

In relation to specialist sustainability <\/span>staff, the biggest rise was in the use of in-house Passivhaus-trained designers, now employed by 77 per cent of the practices, up from 70\u00a0per cent.\u00a0<\/span><\/span><\/p>\n

However, the percentage saying they frequently advocated retrofit to clients over demolition remained unchanged at 66 per cent.<\/span><\/p>\n

Progress on measuring carbon appears to be both slow and mixed. While 10 per cent of practices now always measure embodied carbon compared with 7 per cent the previous year, the proportion of those never doing so also inched up, from 6 to 8 per cent. However, just five years ago, this figure stood at 35 per cent, showing that\u00a0 <\/span>progress has been made.\u00a0<\/span><\/p>\n

There is little change in those undertaking the measurement of operational emissions \u2013 this appears to have plateaued. Once again this is measured by 88 per cent of the AJ100 practices \u2013 the first time this figure has failed to rise since the survey started collecting the data in 2019. Eleven per cent of practices always measure these emissions \u2013 up one percentage point on the previous year. \u00a0<\/span><\/p>\n

Four practices said they always measured whole life carbon \u2013 one fewer than last year.\u00a0<\/span><\/p>\n

\"\"<\/p>\n

Three practices report always carrying out post-occupancy evaluations compared with just one last year. The number never doing so has fallen from 15 to 11 per cent, which compares with 26 per cent in 2019. The percentage (11 per cent) of those doing this frequently is unchanged, while those doing it occasionally continues to rise, reaching 75 per cent. This compares with 48 per cent in 2020.<\/p>\n

There is some limited progress on measuring the human and environmental impact of materials (toxicity, health, reuse\/recyclability). This is now assessed to some extent by 96 per cent of the AJ100, up from 91 per cent. Seventy five per cent do so either frequently or occasionally, and 21 per cent always do so, compared with 23 per cent the previous year.<\/p>\n

Enthusiasm is shifting for the various sustainability initiatives on offer. Architects Declare is still the most popular with 85 of this year\u2019s AJ100 practices signed up to it, though this is two down on the previous year. Similarly, 65 rather than 70 are part of the RIBA\u2019s 2030 Climate Challenge this year. On the other hand, 10 more practices have joined the UK Green Building Council and Race to Zero membership is up from 13 to 16.\u00a0<\/span><\/p>\n

As was the case last year, six practices have joined all five of these initiatives, but seven haven\u2019t joined any, compared with five last year.<\/p>\n

B-Corp certification is gaining momentum with 22\u00a0 <\/span>in the process of becoming certified in addition to the eight that already are.<\/p>\n

\n

Salaries<\/h3>\n

Median pay has increased across all job categories with directors\u2019 pay reaching \u00a3100,000 for the first time<\/em><\/p>\n

\"\"<\/p>\n

Median pay of directors at AJ00 practices reached \u00a3100,000 for the first time, after rising by \u00a35,000 over 2023. Six practices now report paying partners\/directors more than \u00a3150,000 per year (the same number as last year), with just one practice paying less than \u00a360,000. \u00a0<\/span><\/p>\n

Associates\u2019 median pay was \u00a359,200 in 2023, up just over \u00a32,000. In 49 practices, associates typically earned at least \u00a360,000, compared with 32 last year and 18 in the year before that. The highest paid associate earned \u00a378,900.<\/p>\n

Architects are typically being paid \u00a31,300 more than last year with median pay now \u00a343,600. The highest recorded architect salary was \u00a371,000, just over double the lowest.<\/p>\n

Median pay to Part 3 students rose by \u00a31,100 to \u00a332,100, and by \u00a31,300 to \u00a325,300 for year-out students.\u00a0<\/span><\/p>\n

Salary satisfaction was little changed according to the employee survey, with 71\u00a0per cent either satisfied or very satisfied \u2013 marginally more than the year before (69 per cent).<\/p>\n

\n

\"\"<\/p>\n<\/div>\n

\n

Fees<\/h3>\n

Populous leads the field by far when it comes to architectural fees earned per member of architectural staff employed in the UK<\/em><\/p>\n

Compared with last year, median fee rates show either no change or small changes.\u00a0 <\/span>Increases are mainly among high-value traditional new-build contracts, recovering the losses of last year. Design and build and refurbishment rates seem to have declined slightly across the board. \u00a0<\/span><\/p>\n

Of the practices providing information for both this and last year\u2019s AJ100, 57\u00a0said fees paid to their UK offices had increased while 45 reported a decline.<\/p>\n

\n

\"\"<\/p>\n<\/div>\n

Populous is in a league of its own for architectural fees per member of architectural staff in the UK, achieving \u00a3474,000, more than double that of second- placed Foster + Partners and third-placed Zaha Hadid Architects, which both exceed \u00a3200,000.<\/p>\n

Sixty-five of the practices providing information in both this and last year\u2019s AJ100 increased their income per architectural staff in the UK, and 37 had reduced incomes per architectural staff. \u00a0<\/span><\/p>\n

Overall, 13 practices earned at least \u00a3150,000, 10 of which achieved earnings at least 50 per cent above the median for all AJ100 practices. At the other end of the scale, three practices earned less than \u00a360,000 per member of architectural staff, compared with one last year and two in the year before that.<\/p>\n

Populous (by far) and Foster + Partners also lead the way in terms of income per architect in the UK (data not displayed). Along with tp bennett and HOK, they earn more than \u00a3400,000 in architectural fees per architect in the\u00a0UK.<\/p>\n

Two practices also earned less than \u00a3100,000 per architect compared with none last year (and six the year before that). Of the practices providing information for both this and last year\u2019s AJ100, 56 increased their income per architect in the UK, while 46 saw a\u00a0decline.<\/p>\n

\n

Architectural assistants and apprentices\u00a0<\/span><\/span><\/h3>\n

After last year\u2019s significant rises, numbers of architectural assistants and apprentices have fallen\u00a0<\/span><\/em><\/p>\n

The number of architectural assistants at AJ100 practices fell in 2023, in contrast to a substantial rise the previous year. Including apprentices, there were 1,643 Part\u00a02 architectural assistants, down 9 per cent on 2022; and 820 Part 1s, down 4 per cent.\u00a0<\/span><\/p>\n

The total number of apprentices employed by AJ100 practices also fell slightly, from 291 to 283, after rising by nearly a third in 2022. Seventy-three practices have at least one, compared with 58 in\u00a02022.<\/p>\n

\"\"<\/p>\n

As last year, Foster + Partners had by far the most architectural assistants (219 in total) though this is down on the 272 employed in 2022.\u00a0 <\/span>And also as last year, BDP is second, with 107 \u2013 an increase of 10 \u2013 with Populous third with 77.\u00a0<\/span><\/p>\n

Part 1 and Part 2 assistants account for 18.7 per cent of the AJ100\u2019s collective architectural staff in the UK. In five practices, the share is more than 40 per cent (BPTW, Populous, rg+p, PLP and Bennetts), and in 14, it is lower than 10 per cent of the architectural workforce.\u00a0<\/span><\/p>\n

\n

Rising energy costs<\/span><\/h3>\n

Practices responded to higher fuel bills by making their offices more energy efficient<\/em><\/p>\n

\"\"<\/p>\n

Far fewer AJ100 practices compensated employees for rising energy costs in 2023 \u2013 16 per cent compared with 38 per cent the previous year. Instead, practices were more likely to have improved the energy efficiency of their offices (55 per cent, up from 31 per cent) or adjusted their building management system (27 per cent, up from 22 per cent). And more (15 per cent, up from 12 per cent) relocated to more energy-efficient premises.\u00a0<\/span><\/p>\n

Architype was the only practice to have taken all four of these measures. LSI, Studio Egret West and Ryder did three of the four while 23 respondents reported carrying out two of the measures and 54 practices, one.<\/p>\n

A survey of AJ100 employees revealed little change in attitudes towards practices\u2019 responses, with 61 per cent either fairly or very satisfied, compared with 62 per cent in 2022.<\/p>\n

\"\"<\/p>\n

\n

Overseas work<\/h3>\n

Fees earned from work abroad are higher than ever but continue to be dominated by a select few practices<\/em><\/p>\n

Architectural fees from overseas projects paid to UK offices totalled \u00a3484 million, up an impressive \u00a3122 million on last year\u2019s \u00a3362 million, which itself was up \u00a325 million on the previous year\u2019s total. \u00a0<\/span><\/span><\/p>\n

Of the 64 practices reporting such income, Foster + Partners, Zaha Hadid Architects (ZHA) and Populous dominate, with Fosters alone responsible for just under half the total. Together, these three practices account for almost three-quarters of the overseas earnings to UK offices.<\/span><\/p>\n

While most UK offices of AJ100 practices earn all, or the vast majority, of their income from UK projects, ZHA (96 per cent), WATG (92 per cent), Populous (88 per cent), Fosters (88 per cent), and PLP (64 per cent) all earned most to nearly all of their UK office income from overseas work.\u00a0<\/span><\/span> \u00a0<\/span><\/span><\/p>\n

Architectural fee earnings to overseas offices were reported by 41 of this year\u2019s AJ100 \u2013 one up on last year. These offices earned a total of \u00a31.34 billion, up on last years\u2019 \u00a31.19 billion. Like overseas income to UK offices, this total is dominated by a few firms, especially Perkins&Will (37.5\u00a0per cent of the total) and HOK (26 per cent).<\/span><\/p>\n

 <\/p>\n

\n

\u00a0<\/span>\"\"<\/p>\n<\/div>\n

Among the 72 practices reporting active overseas projects, just over half reported having projects in Ireland and two-thirds in the other western EU countries. And despite various human-rights controversies, almost half reported having projects in Saudi Arabia (47 per cent, up from 38 per cent), just exceeding those with work in the UAE\u00a0 <\/span>(46 per cent). A third reported having projects in the eastern EU countries while a quarter had projects in the European Economic Area states of Switzerland, Norway and\u00a0Iceland. Half had projects in North America. Those working in China or Hong Kong fell from 37 to 31 per cent while those working in India rose from 25 to 32\u00a0per\u00a0cent.\u00a0<\/span><\/span><\/p>\n

\n

Outlook<\/h3>\n

The level of optimism among AJ100 practices has fallen markedly over the past two years<\/em><\/p>\n

Optimism levels have slipped to their lowest since 2019, with only 55 per cent of practices now describing themselves as optimistic or very optimistic for 2024.\u00a0<\/span><\/p>\n

This compares with 62 per cent for 2023 and a peak of 86 per cent for 2022,\u00a0 <\/span>surveyed at a time when the profession was emerging from the pandemic. Nine per cent describe themselves as pessimistic, up from six and two per cent the previous two years.<\/p>\n

No practices expect to open new offices in 2024, and there are no planned closures except for one practice that plans to amalgamate two nearby offices. \u00a0<\/span><\/p>\n

\"\"<\/p>\n

\n

Hybrid working<\/span><\/h3>\n

Nearly all AJ100 practices are now mandating a minimum number of days in the office with three days a week the most common<\/em><\/p>\n

Almost all (94 per cent) of AJ100 practices now mandate a minimum number of days in the office each week. This compares with 73 per cent the previous year, suggesting a tightening of hybrid working practices. The few who don\u2019t are ADP, AECOM, AtkinsR\u00e9alis, jmarchitects, NORR Consultants and Stride Treglown.<\/p>\n

\"\"<\/p>\n

Of those who do mandate, three days a week in the office was the most popular arrangement favoured by a little over half (56 per cent), with 20 per cent requiring four days and 15 per cent requiring two. Eight practices mandated staff to come in every day: Darling Associates, PLP Architecture, dMFK Architects, JTP, Stiff + Trevillion, LSI Architects, Falconer Chester Hall and Hadfield Cawkwell Davidson.<\/p>\n

While there has been a very slight decline in satisfaction levels according to the employee survey, 83 per cent are still very or fairly satisfied with the degree of flexibility they have over when they work in the office or at home. This compares with 90 per cent a year ago.\u00a0<\/span><\/p>\n

It\u2019s a similar picture when asked about how the practice has adapted its work processes to hybrid working \u2013 85 per cent are satisfied to some extent, down from 91 per cent the previous year.<\/p>\n

\"\"<\/p>\n

\n

Techniques<\/h3>\n

The number of practices using artificial intelligence\/machine learning has nearly doubled in the past year<\/em><\/p>\n

The biggest change in architectural techniques has been a sharp increase in engagement with artificial intelligence\/machine learning (AI\/ML). Eighty-six per cent now make some use of it compared with 44 per cent the year before. However the number of practices using it extensively remains low \u2013 just three practices: Bryden Wood, WATG and Leonard Design.\u00a0<\/span><\/p>\n

Of the practices using AI\/ML, 58 said they were using it for project work while 62 were applying it to practice operations.\u00a0 <\/span>Thirty-eight were applying it to both.<\/p>\n

There has been little movement in the uptake of other digital technologies \u2013 5 per cent fewer make extensive use of virtual reality this year, although it is still used to some degree by 84 per cent of AJ100 practices. Augmented reality use remains fairly steady with 73 per cent using it to some extent. There has been a small increase (4 percentage points) in the number of practices using 3D-printed\u00a0models.<\/p>\n

\"\"<\/p>\n

Nor is there much change in the use of more traditional techniques. Sketching is still used extensively by almost half the AJ100 practices (46 per cent), and moderately by most of the rest (42 per cent), Thirteen practices said they made only limited use of it. Model-making by hand is deployed by 90 per cent of practices compared with 88 per cent the year before.<\/p>\n

In addition to the techniques shown in the graphs above, environment analysis tools are used by 90 per cent of practices, animations by 89 per cent and site surveying and mapping by 87 per cent. Each of these is used extensively by about a quarter of the practices.\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

The AJ100 Index Subscribers can rank, read and compare AJ100 practices\u2019 financial figures and business data \u2013\u00a0 including fee income, staff numbers and percentage of female architects \u2013 from 2011 onwards. Click here to view the AJ100 Index. 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