Higher nonresidential construction is generating demand for industry services, benefiting electrical contractors.
New York, NY (PRWEB) August 22, 2014
The Electricians industry provides an essential service both for the construction of new buildings and for homeowners and businesses in need of electrical repair or installation work. “Industry operators run electrical and telecommunications wire and cabling through the internal structure of buildings and may also be contracted for climate control, security system and fire safety installations,” according to IBISWorld Industry Analyst Omar Khedr. They also perform work for large-scale industrial projects (e.g. factories and energy infrastructure) and commercial or institutional buildings (e.g. office buildings and hospitals). These lucrative contracts are pursued by the industry's largest companies, while the vast majority of contractors operate on a small, local basis and rely on the housing market for business.
With demand dispersed among many downstream construction markets, Canada's recession in 2009 led to a sharp industry contraction. However, a quick rebound in 2010 and steady progress since then has led industry revenue to grow at an annualized rate of 4.1% to $12.2 billion in the five years to 2014. IBISWorld expects revenue to rise by only 1.4% in 2014 in response to the cooling Canadian housing market.
The industry experienced a period of thin profit margins during the recession. “Profit has since recovered, partly due to the exit of smaller, unprofitable enterprises in 2009 and 2011,” says Khedr. As more contractors enter the industry in the coming five years and underbid established players to gain business, margins are forecast to record limited growth.
Canadian construction markets are projected to progress steadily over the next five years, with industry contractors growing in kind. Slower growth in the housing market, a primary source of contracts for the industry's small operators, will preclude more robust expansion. Single-family housing markets remain overheated in many areas and will demonstrate volatile performance over the next five years, limiting industry growth in the process.
For more information, visit IBISWorld’s Electricians in Canada industry report page.
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IBISWorld industry Report Key Topics
This industry performs electrical work at the site (e.g. installing wiring), services electrical equipment at the site and also may perform the combined activity of selling and installing electrical equipment. The electrical work performed includes new work, additions, alterations, maintenance and repairs. Contractors that primarily work on distribution and power line projects are excluded from the industry.
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Products & Services
Globalization & Trade
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