Municipal Building Construction in the US Industry Market Research Report from IBISWorld Has Been Updated
Los Angeles, CA (PRWEB) September 10, 2013 -- The Municipal Building Construction industry experienced a downturn over the past five years, after reaching a peak in revenue in 2008. The industry underwent strong growth leading up to 2008 and contracted only 3.4% in 2009, due to continued work on a backlog of projects funded by the private sector. The industry also benefited from public programs during 2008 and 2009, such as the American Recovery and Reinvestment Act. However, industry revenue plummeted 14.6% in 2010 as public funding decreased, particularly in the educational building construction market. Furthermore, healthcare funding from the private sector fell during 2009 and 2010, which reduced demand for new buildings. As a result, over the five years through 2013, the industry is expected to decline by an average annual rate of 5.4%. However, while the value of private nonresidential construction is expected to grow in 2013, helping the industry stabilize, the industry is still anticipated to decline 0.8% to $150.1 billion.
According to IBISWorld Industry Analyst Jeremy Edwards, “The decline in demand for municipal building construction has intensified competition over the past five years.” Industry enterprises are estimated to have grown by an average annual rate of 0.1% over the five years through 2013, despite falling revenue and profitability. Although there has been an increase in the level of consolidation from major firms such as Turner Corporation, there have also been a number of small, nonemploying firms entering the market and earning jobs through subcontracts.
Over the five years to 2018, the Municipal Building Construction industry is expected to experience modest growth. Funding from the public sector is projected to be low over the next two to three years as the federal government pursues austerity measures. “The private sector, however, is forecast to grow and more public-private partnership models are expected,” says Edwards. The introduction of the Patient Protection and Affordable Care Act is expected to create additional demand for medical buildings; however, benefits will only be felt toward the end of the period. Input prices are expected to rise as construction levels increase globally, and the industry's larger players are projected to continue consolidating. Together, these factors will usher in revenue growth.
The Municipal Building Construction industry is characterized by a low level of market share concentration. The industry is highly fragmented, as construction jobs are typically outsourced to a variety of different construction companies that are active in the corresponding state. The narrow scope of this industry also decreases larger firms' market share, as the majority of construction firms operate across general nonresidential construction markets rather than municipal building construction specifically.
For more information, visit IBISWorld’s Municipal Building Construction in the US industry report page.
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IBISWorld industry Report Key Topics
The Municipal Building Construction in the US industry comprises contractors that are responsible for the complete construction (i.e. new work, additions, alterations and repairs) of institutional buildings, such as schools, hospitals, churches, civic centers and prisons. The industry also includes operators that perform construction management on institutional building projects. Types of operators include general contractors, design builders, engineer-constructors, joint-venture contractors and turnkey contractors.
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About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.
Gavin Smith, IBISWorld, +1 (310) 866-5042, [email protected]
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