Foreign demand for US goods will spur growth as more production facilities are needed.
Los Angeles, CA (PRWEB) November 10, 2013
The Industrial Building Construction industry is responsible for constructing factories, assembly plants and mineral processing mills. The health of the US manufacturing sector determines its growth, as most industry projects are related to buildings used to produce and distribute goods. Interest rates, property values and lending standards also influence growth because loans and bonds finance most developments and renovations.
Industry revenue is expected to fall an average annual 1.2% to $45.6 billion in the five years to 2013. During this period, the industry experienced significant revenue volatility. Government spending at the federal and local level protected the industry between 2008 and 2009 by channeling investments into manufacturing facilities and the automotive sector. However, cutbacks in government spending, coupled with overdevelopment and slow economic growth, caused industry revenue to drop 18.2% in 2010. The industry returned to positive growth in 2012, when industries like the Semiconductor Machinery Manufacturing industry (IBISWorld report 33329a) expanded production, thus, increasing demand.
Growth is expected to continue over the next five years as operators benefit from an improved economy and the reinvestment of corporate profit into new manufacturing and distribution structures. Foreign demand for US goods are also expected to boost industry growth. Additionally, foreign companies have expanded their manufacturing operations in the United States to be closer to their end-consumers. As a result, demand for new or remodeled industrial space is set to rise as manufacturers and industrial companies look to expand production, lifting industry revenue up by anticipated 2.3% in 2013.
While lending standards will loosen over the next five years, interest rates are also expected to rise during this period, thereby increasing the cost of new industrial development. Additionally, outsourcing basic manufacturing to countries with lower labor costs will continue to hinder investment into domestic manufacturing structures.
For more information, visit IBISWorld’s Industrial Building Construction in the US industry report page.
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IBISWorld industry Report Key Topics
The Industrial Building Construction industry is composed of contractors that are primarily responsible for the construction (e.g. new work, additions, alterations, maintenance and repairs) of industrial and manufacturing buildings. Establishments include general contractors, design-build companies and construction management operators.
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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