Because of deferred maintenance during the down economy, a growing number of properties will need rehabilitation or upgrades, which will necessitate the use of scaffolding
Los Angeles, CA (PRWEB) April 17, 2012
In the five years to 2012, total construction spending dropped at an average annual rate of 7.1% to $862.4 billion from $1.25 trillion in 2007, causing demand for the Scaffolding Contractors industry to dive. According to IBISWorld industry analyst Andrea Alegria, “demand for scaffolding contractors is directly driven by the levels of residential and non-residential construction activity. With the recovery in residential construction starting to gain traction, demand for specialist trades is also improving. Scaffolding services will grow significantly as pent-up demand, population growth and improved access to credit boost demand for new housing. A large population cohort (Generation Y) will reach first-time homebuyer status and will likely encounter a limited inventory of new homes, which will increase demand for housing. Also, because of deferred maintenance during the down economy, a growing number of properties will need rehabilitation or upgrades, which will necessitate the use of scaffolding.”
However, commercial construction activity remains weak; commercial construction tends to lag the overall economy by 12-24 months (due in part to the length of construction contracts and industry backlog). Alegria adds that “towards the end of the five year forecast period, scaffolding companies will continue to experience strong demand from power plants, refineries and petrochemical plants and their contractors. Factories and manufacturing facilities that expand operations will also require industry products. Furthermore, federal, state and local governments will likely recover from depleted budgets as a result of lower tax collection during the down economy. As a result, increased government spending will lead to construction and repair of bridges, tunnels and other infrastructure that require scaffolding.”
Scaffolding Contractors specialize in putting up scaffolds and platforms needed for some types of new building construction, along with painting, renovation, and restoration of all sorts of structures. Scaffolding contractors can also work on offshore oil rigs, power stations, and projects such as parade viewing platforms. Scaffolding is typically made from metal pipes, which are connected together to create a frame that can be re-configured as needs change. As scaffolding is put up, platforms are established for holding tools and walking around worksites. When the job is finished, contractors in this industry dismantle the scaffolding.
The industry is highly regulated and contractors that install scaffolding must meet stringent safety standards imposed by the Occupational Safety and Health Administration (OSHA). Nonetheless, the industry has low barriers to entry as most OSHA certification can be obtained through short educational courses. Moreover, expensive capital equipment can be leased, or certain jobs subcontracted to other companies. Entry to the commercial space is more difficult that residential; jobs are much larger and require a more specialized skill-set. As such, scaffolding work in the commercial construction space tends to have a higher market share concentration than the residential sector. Like other specialty contracting trades, residential specialists are highly fragmented and include a large number of small operators that focus on small or regional markets. The basis for competition varies across the many segments of this industry, but generally involves a mix of pricing competitiveness, proven workmanship and timeliness. Major players in the industry include Safway Inc., Harsco Infrastructure and The Brock Group.
For more information visit IBISWorld’s Scaffolding Contractors in the US Industry page
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IBISWorld industry Report Key Topics
This industry leases, erects and dismantles scaffolding equipment. Scaffolding can be used during construction, painting, exterior remodeling and for other construction-related activities that require workmen to work above ground level.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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