Finish Carpentry 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 31,600 finish carpentry contractors in the US build and install specialty carpentry products used to finish buildings. Services include the installation of cabinets, countertops, doors, windows, door and window frames, garage doors, millwork, molding, trim, paneling, decks, shelving, and stairs. Projects include work on single-family homes, commercial buildings (stores, restaurants), office buildings, apartment buildings, health care and institutional buildings, and educational buildings. Most firms are small, independent operators that serve a local market.
Seasonality Of Demand
The volume of work for finish carpentry contractors varies throughout the year and is influenced by seasonal factors.
Dependence On General Contractors
Finish carpentry contractors are often part of a team of specialty contractors hired by a general contractor.
Industry size & Structure
The average finish carpentry contractor operates out of a single location, employs 5 workers, and generates about $854,000 annually.
- The finish carpentry industry consists of 31,600 establishments that employ 160,000 workers and generate $27 billion annually.
- The industry is highly fragmented. Most firms are small, independent operators that serve a local market.
- About 30% of carpenters are self-employed, according the Bureau of Labor Statistics. Most self-employed carpenters work in residential construction.
Industry Forecast
Finish Carpentry Contractors Industry Growth
Recent Developments
Jun 12, 2024 - Industry Growth Poised for Rebound
- The finish carpentry contracting industry is expected to see almost flat sales growth this year, but demand is projected to improve in the following four years. The industry’s year-over-year sales increased by 10.6% in 2022 before dropping to 3.2% in 2023, according to Inforum and the Interindustry Economic Research Fund, Inc. Sales growth is projected to fall to 1.1% in 2024, then rise by 6.9% in 2025. The industry will then see steady average annual growth of about 6.8% through 2028, according to Inforum and the Interindustry Economic Research Fund, Inc.
- High interest rates have slowed the US housing market, a key demand driver for finish carpentry contracting. In May 2024, the average 30-year fixed-rate mortgage rose seven basis points to 7.06% compared to 6.99% in April, according to Freddie Mac. May’s rate was up 64 basis points from May 2023, when the average 30-year fixed-rate mortgage was 6.34%. The National Association of Home Builders (NAHB) expects 30-year mortgage rates to linger in the 6.66% range through the end of the year and dip slightly below 6% by the end of 2025. The NAHB projects that the Federal Reserve will announce a rate cut at its meeting in December, and there will be another six cuts in 2025.
- A lack of affordability in the US housing market is prompting a building boom of for-rent homes, according to The Wall Street Journal. Amid high interest rates and home prices, many affluent potential home buyers are priced out of the single-family and townhome markets. In 2023, US builders completed 93,000 for-rent homes - the most ever in a single year and up 39% over 2022, according to John Burns Research and Consulting. There are another 99,000 for-rent homes currently under construction, but the breakneck pace of development is expected to slow as lending standards tighten. However, some industry watchers believe any lull in built-for-rent home demand will be brief as economic conditions make renting a better financial option than buying. As of March 2024, the average monthly mortgage payment was 38% higher than the average monthly apartment rent, according to CBRE.
- Amid a shortage of existing homes on the market, 61% of home buyers prefer new homes, according to a recent survey by the National Association of Home Builders (NAHB). The survey’s results show the highest share of new-home preference since 2007 when 63% of home buyers preferred new construction. Homeowners who locked in a low interest rate before 2022, when the Federal Reserve began raising interest rates, are reluctant to sell and swap their low-interest loans for a higher rate. New single-family homes have filled the void in the market left by a lack of existing homes for sale. Residential construction is a key demand driver for plywood and engineered wood products.
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