IBISWorld Market Research
The credit-counseling segment will support growth as unemployment creates financial stress
Los Angeles, CA (PRWEB) September 10, 2012
In the five years to 2012, the Credit Counselors, Surveyors and Appraisers industry has grown at an annualized rate of just 0.2% to $45.6 billion. According to IBISWorld analyst Eben Jose, “The industry's growth was slowed by the recession, which reduced demand for quantity surveying and cost estimating.” Demand for quantity surveying services began to ease as a construction downturn began in 2006, driven by falling demand in the residential sector. This trend was followed by a commercial construction slump as the recession hit and access to credit dried up in 2008.
If not for the credit-counseling segment, industry revenue would have declined. “Luckily for credit counselors,” says Jose, “the recession has caused many consumers to go into debt and seek professional advice on their credit.” Credit counseling has grown over the past decade from rapidly increasing consumer debt; however, the recession has accelerated this growth. With high levels of debt going into the recession, the rise in unemployment and falling home and stock values pushed a number of consumers into financial stress, triggering stronger demand for credit counseling. Similarly, the appraisal services segment has helped provide a stable revenue base as cash-strapped owners seek to value and liquidate nonproductive assets.
Concentration in the Credit Counselors, Surveyors and Appraisers industry is very low, with a large number of small operators including many non-employers and small partnerships. In 2012, IBISWorld estimates that an overwhelming majority of firms operating in this industry are non-employers. These sole proprietors account for about four-fifths of industry revenue. On the other hand, the four largest firms are expected to make less than 5.0% of industry revenue in 2012. The nature of services provided in this industry mean that there are few benefits to be realized from increasing the scale of operations. Credit counseling is the main segment in which there exist potential economies of scale, such as through the use of IT infrastructure for efficient payment processing.
Despite the recent drops in unemployment, credit counselors will continue to benefit from a relatively high unemployment rate. Furthermore, marginal improvements in downstream construction markets will boost demand for quantity surveying. As a result, IBISWorld estimates that industry revenue will increase 0.5% in 2012. These factors are expected to continue during the five years to 2017, when industry revenue is forecast to increase further. Continued demand in the credit-counseling segment will intersect with a return to growth in quantity surveying, boosting industry revenue.
For more information, visit IBISWorld’s Credit Counselors, Surveyors and Appraisers in the US industry report page.
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IBISWorld industry Report Key Topics
This industry provides quantity surveyor services, also known as cost estimation; estate appraisal services (except real estate); and consumer credit counseling services.
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