Structural Steel and Precast Concrete 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 3,500 structural steel and precast concrete contractors in the US erect, assemble, and install structural elements of buildings. Large firms may offer design/build services or fabrication services. Firms may also offer repair or restoration services.

Dependence on Nonresidential Construction Activity

Demand for structural steel, reinforcing steel, and precast concrete is primarily dependent on nonresidential construction activity, which can be cyclical and influenced by economic conditions.

Hazardous Work

Steel erection is one of the top 10 most hazardous occupations in the US, as the incidence of injury and illness for structural steel and precast concrete contractors was more than 20% higher than the national average in 2019.

Industry size & Structure

The typical structural steel and precast concrete contractor operates out of a single location, employs about 20+ workers, and generates between $4 million and $5 million annually.

    • The structural steel and precast concrete contracting industry consists of about 3,500 companies that employ about 77,000 workers and generate between $15 billion and $16 billion annually.
    • The industry is fragmented; no true national firm dominates, however the largest companies, such as Span Construction & Engineering and Crossland, operate it numerous states. Integrated companies design, fabricate, and install structural steel products.
                              Industry Forecast
                              Structural Steel and Precast Concrete Contractors Industry Growth
                              Source: Vertical IQ and Inforum

                              Coronavirus Update

                              May 16, 2022 - Architectural Billings Rise
                              • Demand for building design services is strong, according to an April report by the American Institute of Architects (AIA). The AIA’s Architecture Billing Index (ABI), an indicator of future building construction demand, was 58 in March, up from 51.3 in February. Any reading above 50 indicates growth in architectural billings. The rise in billings is likely due to an effort to lock in interest rates ahead of continued rate hikes in the coming months. The ABI reading for commercial/industrial projects was 55.3 in March. On a regional basis, the South registered the strongest March ABI score with 57.2, followed by the Midwest (56.2), the West (54), and the Northeast (46.3).
                              • Construction hiring has remained “solid” despite pandemic-related labor shortages, according to Contractor Magazine. LaborIQ predicts a 3.9% growth in construction jobs in 2022, a commensurate 3.9% median wage growth, and, in some metropolitan regions, even wage growth of over 4.5%. Many experts say that increased wages may bring people back to work and lessen the impact of labor shortages in some geographical regions.
                              • The Dodge Momentum Index increased 6% in April 2022 to 164.8 (2000=100), up from the revised March reading of 155. The Momentum Index is a monthly measure of the first (or initial) report for nonresidential building projects in planning, which has been shown to lead construction spending for nonresidential buildings by a full year. The commercial planning component increased by 9%, and institutional planning rose by 2%. The commercial planning pipeline was robust due to data center, warehouse, and hotel projects. While the backlog of nonresidential building projects is strong and should remain solid in the coming months, rising interest rates and higher materials costs could moderate construction activity through 2022.
                              • Nonresidential construction spending, a key driver of demand for structural steel and precast concrete contracting services, increased 5.8% year over year in March 2022, according to the US Census Bureau. Office construction spending increased 4.6% during the period, while commercial construction spending rose 13.9%. Spending for healthcare facilities was up 7.1%, and manufacturing construction spending increased 31.8%. Construction spending for several other types of nonresidential building construction declined in March compared to a year earlier, including lodging (down 25%), public safety (-24.1%), educational (-2.1%), and religious (-11.7%).
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