The industry recorded healthy growth in recent years following recessionary declines.
Los Angeles, CA (PRWEB) November 18, 2013
Growth in the Air and Gas Compressor Manufacturing industry was suppressed in 2008 and 2009 by falling industrial activity worldwide and plunging demand from major downstream markets, particularly construction and related machinery manufacturing. “Continued weakness in construction markets despite rising manufacturing activity has failed to raise the industry above its prerecession highs,” according to IBISWorld Industry Analyst Dale Schmidt. Nevertheless, the industry recorded healthy growth of 4.7% and 5.1% in 2011 and 2012, respectively. Over 2013, revenue is estimated to grow another 4.1% to $7.3 billion, marking annualized growth of 1.4% since 2008.
Currently, about 197 companies manufacture air and gas compressors, related parts and industrial spraying equipment in the United States. This number has decreased over the past five years because many firms exited the industry during the economic decline. Employment, meanwhile, has already fully recovered from the recession. Over the five years to 2013, the number of industry employees is projected to grow at an annualized rate of 0.8% to about 14,328. The industry utilized the downturn, though, to enact productivity enhancements through capital investments and operational improvements, which have since resulted in lessened labor requirements.
Despite struggling revenue, rising productivity helped offset growing wage costs. These enhancements also helped manufacturers regain profit margins after substantial losses in 2008 and 2009. Major company Gardner Denver, for instance, recorded a substantial loss in 2009; since then, company profit margins have climbed and eclipsed those achieved prerecession. Similar trends have occurred in the overall industry. “Struggling, less-profitable firms either exited the industry or were acquired by larger firms,” says Schmidt.
Over the next five years, the industry is expected to enter a period of sustained growth, aided by a strengthening US economy and rising demand from industrial markets worldwide. In addition, the long-awaited recovery of the US construction sector will increase demand for air and gas compressors used in construction machinery.
For more information, visit IBISWorld’s Air and Gas Compressor Manufacturing in the US industry report page.
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IBISWorld industry Report Key Topics
This industry manufactures air and gas compressors, parts for air and gas compressors and industrial spraying equipment.
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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