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 31,170 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 $866,000 annually.

    • The finish carpentry industry consists of 31,170 establishments that employ 163,300 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
                          Source: Vertical IQ and Inforum

                          Recent Developments

                          Apr 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.
                          • The housing construction industry continues to experience a significant labor shortage, but the lack of workers has been mitigated somewhat by an increase in immigration since 2022, according to a recent report by the National Association of Home Builders (NAHB). However, in the March NAHB/Wells Fargo Housing Market Index Survey (February data), nearly two-thirds of home builders reported “some or serious shortages of workers performing finish carpentry.” Immigrants account for about a third of finish carpenters in the US. The construction sector’s reliance on immigrant labor varies by state. At 40%, California and Texas have some of the highest percentages of immigrant labor forces, followed by Florida (38%), New York (37%), New Jersey (37%), and Maryland (34%).
                          • Total nonresidential building construction spending is projected to rise 9% in 2024 over 2023, according to FMI’s second-quarter 2024 North American Engineering and Construction Outlook. With growth of 19%, manufacturing will lead 2024 nonresidential building construction, followed by lodging (14%), public safety (12%), and transportation (10%). Some other segments of the nonresidential building sector face headwinds, including high interest rates, inflation, and tighter lending standards. These pressures and high vacancy rates will limit office project spending to 2% growth in 2024. Led by a weakening warehouse segment, commercial project spending is forecast to decline by 2% in 2024. High interest rates will also challenge the housing market. Single-family construction spending is forecast to be flat in 2024 after falling 14% in 2023. Spending for multifamily is expected to decline 8% in 2024 after projects in development peaked at 1 million units in mid-2023. Home improvement project spending will rise 2% in 2024 after falling 5% in 2023.
                          • Higher consumer prices, a leading indicator of inflation, came in hotter than expected, which could push mortgage rates higher, according to the National Association of Realtors (NAR). Bureau of Labor Statistics data show that the consumer price index (CPI) rose to 3.5% in March. The Federal Reserve has indicated that it won’t reduce the short-term benchmark interest rate until the CPI drops to the Fed’s target of 2%. NAR Chief Economist Lawrence Yan said, “March inflation figures were very bad, which also means bad news for interest rates. Mortgage rates, unfortunately, will move a notch higher and are likely to cross above 7% in the upcoming weeks.” High mortgage rates have put downward pressure on housing demand, which could reduce single-family construction activity.
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