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 Industry Structure, How Firms Opertate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.

Call Preparation Quarterly Insight, Call Prep Questions, Industry Terms, and Weblinks.

Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.

Industry Profile Excerpts

Industry Overview

The 18,600 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 18,600 companies that employ 249,000 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

                                Coronavirus Update

                                Nov 3, 2021 - Construction Dust Does Not Render Masks Ineffective
                                • Drywall dust penetration does not mean face masks are ineffective against the coronavirus, according to Dr. Benjamin Neuman, an expert in coronaviruses at Texas A&M University. Posts on Facebook claim that face masks cannot be effective against the coronavirus because they do not stop drywall dust particles bigger than the virus from reaching a person’s face. “The average size of dry wall dust particles is 3 microns. The average size of a corona virus particle is 0.3 microns,” says a Facebook post that features two images of a man with a surgical mask under his chin, his face coated in white dust. “If masks cant prevent dry wall dust getting through how can they possibly prevent something 10 X smaller from getting through?” the post says. Masks do not need to be 100% effective to help reduce the spread of the virus, and can curb transmission by blocking the larger respiratory droplets that contain it, according to Neuman and other experts. “The size of the viral particle is irrelevant. It is the size of the droplets that contain the virus that counts,” said Dr. Julian Leibowitz, an expert in coronaviruses who is a professor of microbial pathogenesis and immunology at Texas A&M’s College of Medicine.
                                • The average size of a newly-built home was 2,540 square feet during Q2 2021, and the median was 2,297 square feet, compared with 2,473 square feet and 2,265 square feet, respectively, at the end of 2020, according to The National Association of Home Builders (NAHB). The NAHB says that the trend is a continuation of homebuyer interest in more living space and room for working from home -- a result of the pandemic that the trade group says reversed a dip in the average size for new construction that ran from 2016 to 2020.
                                • Most businesses are getting all or nearly all of their Paycheck Protection Program (PPP) loan amounts from 2020 forgiven, with an average loan amount of roughly $102,000 and a forgiveness amount of roughly the same, according to Small Business Administration (SBA) data analyzed by The Business Journals. The SBA issued about $521.2 billion loans during the first wave of the PPP in 2020 and about 73%, or $381.85 billion, has been forgiven as of June 30.
                                • Small-business owners who received taxpayer-subsidized Paycheck Protection Program (PPP) loans of $150,000 or less during the coronavirus pandemic can seek forgiveness directly with the government through an online portal that was opened on August 4, allowing them to sidestep the private financial institutions that ran most aspects of the program for 14 months.
                                • Some businesses that took PPP loans in 2020 but don't apply for forgiveness soon will need to start making payments on the loan plus interest. The PPP loans will automatically convert to a standard loan at 1% interest if a small business does not apply to the SBA for forgiveness within 10 months of the end of the covered period under which they had to spend the money. For some businesses that received a loan when the PPP launched in April 2020, there was an eight-week covered period, which would put the forgiveness application deadline in the middle of July. For most loans operating under the more popular 24-week covered period, that meant a deadline in September.
                                • Small business owners seeking funding from the SBA can apply to the Economic Injury Disaster Loan program, the Targeted EIDL Advance grant program, the Supplemental EIDL Advance grant program, and the Debt Relief program.
                                • Total construction spending decreased 0.5% in value month over month on an adjusted basis but increased 7.9% in value year over year on an unadjusted basis in September, according to the US Census Bureau. Residential construction spending decreased 0.4% month over month but increased 19.2% year over year in September. Nonresidential construction spending decreased 0.6% month over month and 1.2% year over year in September.
                                • Construction workers are five times more likely to be hospitalized with COVID-19 than their peers in other professions, according to a University of Texas at Austin study. Lauren Ancel Meyers, one of the study authors, said that the findings don’t necessarily mean construction work needs to stop. “It means we need to go to great lengths to ensure the health and safety of workers when they do go to work.”
                                • Employment in the specialty trade contracting industry increased 2.4% year over year in September but was down 1.2% compared to September 2019.
                                • Homebuilder sentiment, as measured by the National Association of Home Builders/Wells Fargo Housing Market Index, increased to 80 in October from 76 in September, which was up from 75 in August. Sentiment is still below the 83 reading of May. A reading of more than 50 indicates a positive outlook; a reading under 50 indicates a negative outlook. Sentiment was its lowest level in 13 months in August. “Although demand and home sales remain strong, builders continue to grapple with ongoing supply chain disruptions and labor shortages that are delaying completion times and putting upward pressure on building material and home prices,” said NAHB Chairman Chuck Fowke.
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