Drywall and Insulation Contractors
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 19,300 drywall and insulation contractors in the US perform drywall work, plaster work, and building insulation work for residential and nonresidential buildings. They may also install ceiling tiles, perform fireproofing work for buildings, and do framing or painting work. Work is performed for new building construction, renovations and additions to existing buildings, and maintenance and repair of existing installations.
Dependence on Construction Activity
Demand for drywall and insulation contractors is highly dependent on residential and nonresidential construction activity.
Reliance on Immigrant Workers
The construction industry in general and drywall and insulation contractors in particular, are highly dependent on immigrant workers to fill lower skilled positions.
Industry size & Structure
The average drywall and insulation contractor operates out of a single location and generates $2.3 million in annual revenue.
- The drywall and insulation contractor industry in the US consists of about 19,300 companies that employ 247,100 workers and generate $45 billion in annual revenue.
- The industry consists primarily of small companies - 61% of firms have less than five employees.
- Small firms may specialize in residential or commercial construction, while larger firms typically target both markets.
- Major US companies include KHS&S, Performance Contracting Group, Standard Drywall, Inc. and The Raymond Group.
Industry Forecast
Drywall and Insulation Contractors Industry Growth
Recent Developments
Feb 11, 2025 - Residential Construction Spending Rises
- US private residential construction spending increased 1.5% in December 2024 from November and was up 6% year-over-year. Private residential spending growth in December was led by a 1% rise in new single-family construction spending compared to the previous month, but single-family spending was down 0.8% compared to December 2023. New private multifamily construction spending declined by 0.3% in December 2024 compared to November and was off by 10.5% year-over-year. December’s rise in private residential construction spending marked the third consecutive month of growth.
- North American construction and engineering spending in 2025 is expected to grow by 2% after increasing an estimated 6% in 2024, according to FMI’s first-quarter 2025 North American Engineering and Construction Outlook. With growth of 19%, the data center sub-sector will lead 2025 nonresidential building construction, followed by public safety (9%), amusement and recreation (7%), and power (7%). Commercial construction spending is expected to decline 9% in 2025 amid a 6% decline in warehouse demand, which accounts for more than half of annual commercial spending. Lodging construction spending is forecast to drop by 7%, and stubbornly high office vacancies are expected to hold new office construction to 2% growth in 2025.
- Home remodeling spending is expected to see slight gains in 2025 after two years of weakening expenditures, according to the Leading Indicator of Remodeling Activity (LIRA) report released in January by the Joint Center for Housing Studies at Harvard. Homeowner improvements and repairs are expected to increase by 0.4% to $513 billion in the first quarter of 2025 compared to Q1 2024. In the second quarter of 2025, remodeling spending will rise quarter-over-quarter to $505 billion, up 0.7% from Q2 2024. Spending will then increase to $506 billion in Q3 2025, up 1.2% from Q3 2024. In the fourth quarter of 2025, year-over-year spending is forecast to rise 1.2% to $509 billion. Joint Center expects improvements to be supported by rising home values, a steady labor market, and gradually improving existing home sales. Better retail sales of building materials and solid remodeling permitting activity should also support home improvement spending.
- After posting solid gains in 2023 and 2024, construction spending for nonresidential buildings is expected to slow significantly in 2025 and 2026, according to the American Institute of Architects’ (AIA) Consensus Construction Forecast released in January. Total spending for nonresidential building construction increased by 20% in 2023 and another 6% in 2024 but is forecast to slip to 2.2% in 2025 and 2.6% in 2026. For the next two years, growth will be led by data centers, which should support modest office construction in an otherwise challenging market. The warehouse sector is oversupplied, which will limit spending growth. Spending on institutional projects should remain stable as they are less susceptible to cyclical factors. AIA Chief Economist Kermit Baker said, “The modest outlook is partly based on a few expected headwinds to building activity, including potential tariffs on imports. There is also policy concern around how the construction labor force might be impacted by emerging immigration policy. Construction sector spending has been exceedingly strong – albeit unusually unbalanced – and coupled with these headwinds the projections are only very modest gains the next two years.”
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