Framing 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 12,200 framing contractors in the US erect the structural framing and sheathing in buildings, using primarily wood. Single family homes account for 49% of industry sales. Other types of projects include apartment buildings and commercial buildings (stores, restaurants, gas stations, parking garages).

Vulnerability to Trends in the Housing Market

The framing contracting industry is primarily dependent on upstream demand from the residential construction industry, which is cyclical and sensitive to economic conditions.

Dependence on Skilled Labor

Framing contractors rely on a skilled labor force willing to perform physically demanding work in all types of weather conditions.

Industry size & Structure

The average framing contractor operates out of a single location, employs 7 workers, and generates about $1.4 million annually.

    • The framing contracting industry consists of about 12,200 establishments that employ about 83,500 workers and generate about $16.6 billion annually.
    • The industry is fragmented. Most firms are small, independent operators; over 70% of firms generate less than $500,000 annually.
    • The framing stage accounts for 20.5% of construction costs, the second highest cost category, after interior finishes, according to the National Association of Home Builders (NAHB). Of the detailed items in new home construction, framing and trusses accounted for the largest share of costs (18.4%).
                            Industry Forecast
                            Framing Contractors Industry Growth
                            Source: Vertical IQ and Inforum

                            Recent Developments

                            May 8, 2024 - Framing Industry Poised for Rebound
                            • The US framing contracting industry is expected to post steadier growth after high interest rates and a lack of affordability have slowed the housing market. The industry’s year-over-year sales are expected to rise by 1.1% in 2024 after increasing 3.2% in 2023, according to Inforum and the Interindustry Economic Research Fund, Inc. Annual sales growth is expected to increase by 6.8% in 2025, 7.4% in 2026, 6.7% in 2027, and 6.3% in 2028, according to Inforum and the Interindustry Economic Research Fund, Inc.
                            • The recent What Home Buyers Really Want Study by the National Association of Home Builders offers insight into the type of community homebuyers would prefer to live in. The study showed that survey respondents most valued three key community attributes: convenience, walkability, and a suburban feel. The most highly ranked community feature was proximity to retail space (70% of respondents), followed by near a park (66%), walking/running trails (66%), a walkable community (65%), and a suburban feel (64%).
                            • 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%), transportation (10%), educational (+9%), and healthcare (+8%). Some other segments of the nonresidential building sector face headwinds, including high interest rates, inflation, and tighter lending standards. These pressures will reduce commercial project spending by 2% in 2024. High vacancy rates will hinder office spending and keep growth at a muted 2% over 2023. High interest rates will also challenge the housing market. Single-family construction spending is forecast to be flat in 2024. 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.
                            • Home sizes increased during the pandemic as families sought more space, and interest rates were near record lows. As interest rates have risen and homes have become less affordable, the trend is reversing, and homes are getting smaller, according to National Association of Home Builders (NAHB) analysis of Census Bureau data. In the fourth quarter of 2023, the median single-family home square footage was 2,156, which is the lowest since 2010. The NAHB suggests that smaller home sizes will likely persist amid continued affordability issues.
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