The recession forced many regional governments to cut their highway and structure funding to balance their budgets.
New York, NY (PRWEB) July 13, 2014
Operators in the Bridge and Structure Painting Contractors industry primarily prepare and complete the painting of bridges, overpasses, trestles and other steel structures. Projects undertaken by industry operators are mainly for public structures, making demand for industry services highly dependent on government funding. “This funding originates at the local and state government level and is aided by the backing of the federal government,” according to IBISWorld Industry Analyst Edward Rivera. Over the five years to 2014, the economic recession forced many regional governments to cut their highway and structure funding in an effort to balance their budgets. As a result, over the five-year period, industry revenue is expected to decline at an average annual rate of 2.6% to $590.6 million in 2014. With little changes in budgetary constraints, stagnation is expected to continue in 2014, with revenue declining 0.1%.
Over the past five years, government revenue fell, as rising unemployment resulted in less tax revenue. Further, social safety nets were put in place during this time to help the elderly and those displaced by the loss of employment. “Collectively, this contributed to the growing discrepancy between government revenue inflow and expenditures,” says Rivera. Although the federal government can operate at a deficit, local and state governments are required to balance their budgets at the end of the fiscal year. As a result, many local and state governments decreased their investments in infrastructure. Because the government accounts for the vast majority of industry revenue, the lack of public funding led to declines across the industry over the five years to 2014.
In the next five years, industry revenue is expected to grow as the budgetary constraints of the government at the local, state and federal levels are alleviated. In addition, a forecast increase in the amount of miles US drivers cover, population growth and backlogged projects are expected to lead the surge in demand for industry services. One issue to follow over the next five years will be the state of the Highway Trust Fund, which is slated to fail unless some support is offered. As infrastructure has historically been overlooked in the United States, upcoming disputes about funding for public structure maintenance is likely to temper demand for industry services in the five years to 2019.
For more information, visit IBISWorld’s Bridge and Structure Painting Contractors in the US industry report page.
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IBISWorld industry Report Key Topics
This industry specializes in the application of paint, including corrosion-inhibiting protective coatings, on bridges, trestles, overpasses and other exterior steel constructions.
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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