New York, NY (PRWEB) February 06, 2014
The Heating and Air Conditioning industry is heavily influenced by activity in the construction market, with the majority of income generated from heating, ventilation and air-conditioning (HVAC) installations in new residential and nonresidential structures. Maintaining, monitoring and repairing existing equipment also accounts for a significant share of revenue, lending stability to the industry due to the volatile new construction markets of recent years. These service segments also make the industry susceptible to changes in levels of disposable income. Ultimately, industry revenue is expected to increase at an annualized rate in the five years to 2014.
Moreover, the collapse of the housing market and subsequent economic recession caused new construction activity to decrease dramatically. Between 2009 and mid-2011, demand for new housing was hampered by an oversupply of existing homes and declining property values. Nonresidential building construction activity also declined, as the recession caused a contraction in the business sector. As unemployment rose and businesses reduced operations, more vacancies in commercial buildings appeared and demand for new nonresidential structures weakened. Consequently, these factors hurt demand for HVAC installations across the construction markets.
The Heating and Air Conditioning industry has a low level of concentration, as no industry firm accounts for more than a small percentage of total industry revenue. After two years of declining revenue from 2009 to 2010, the industry rebounded in 2011 and recorded growth in 2013. Positive signs in the housing market indicate the construction sector's burgeoning return to strength. As more homes and commercial structures are built, and require HVAC system installations in turn, demand for industry technicians will increase strongly. Furthermore, national standards for energy efficiency and a growing trend toward lowering household and business energy use, is projected to encourage building owners to upgrade to more efficient systems. With these positive developments, industry revenue is forecast to rise at an annualized rate during the next five years, with significant growth in 2014 alone.