IBISWorld - Concrete Contractors in The US - 2019

WWW.IBISWORLD.
COM Concrete Contractors in the USApril 2019 1
Rock solid: Acceleration of the nonresidential

construction market will support growth
This report was provided to
Edeska (2129455405)
by IBISWorld on 11 November 2019 in accordance with their license agreement with IBISWorld
IBISWorld Industry Report 23811

Concrete Contractors in the US
April 2019 Marisa Lifschutz
2 About this Industry 18 International Trade 28 Revenue Volatility

2 Industry Definition 19 Business Locations 29 Regulation and Policy
2 Main Activities 30 Industry Assistance
2 Similar Industries 21 Competitive Landscape
3 Additional Resources 21 Market Share Concentration 31 Key Statistics
21 Key Success Factors 31 Industry Data
4 Industry at a Glance 21 Cost Structure Benchmarks 31 Annual Change
23 Basis of Competition 31 Key Ratios
5 Industry Performance 24 Barriers to Entry 32 Industry Financial Ratios
5 Executive Summary 24 Industry Globalization
5 Key External Drivers 33 Jargon & Glossary
7 Current Performance 25 Major Companies
9 Industry Outlook 25 Baker Concrete Construction Inc.
11 Industry Life Cycle 25 Structural Group Inc.
26 Ceco Concrete Construction LLC
13 Products and Markets 26 S&F Concrete Contractors Inc.
13 Supply Chain
13 Products and Services 27 Operating Conditions
15 Demand Determinants 27 Capital Intensity
16 Major Markets 28 Technology and Systems
www.ibisworld.com | 1-800-330-3772 | info @ibisworld.com

WWW.IBISWORLD.COM Concrete Contractors in the USApril 2019 2
About this Industry
Industry Definition Operators in this industry are primarily Industry operators also perform grout
engaged in pouring, building and and shotcrete work. The labor
finishing concrete foundations and performed may include new work,
structural elements, such as retaining additions, alterations, maintenance
walls and private driveways and walks. and repairs.
Main Activities The primary activities of this industry are

Concrete placement on construction projects
Finishing on concrete slabs and footings
Foundations construction
Concrete pumping
Sidewalks construction
Curb, culvert and guttering construction or repair
Concreting grout and shotcrete work
Concrete patio construction
Concrete parking lot construction
Installing and finishing precast concrete
The major products and services in this industry are

Additions, alterations and reconstruction
New nonresidential construction
New residential construction
Other services
Similar Industries 23814 Masonry in the US

Industry operators are mainly engaged in concrete block laying.
23834 Tile Installers in the US

Industry operators are mainly engaged in terrazzo laying.
23833 Flooring Installers in the US

Industry operators lay floor coverings.
23891a Excavation Contractors in the US

Industry operators are mainly engaged in excavation and site preparation.
32732 Ready-Mix Concrete Manufacturing in the US

Industry operators produce and deliver ready-mixed concrete.
23731a Road & Highway Construction in the US

Industry operators are mainly engaged as prime contractors to lay road and footpath surfaces.
23411b Road & Highway Maintenance in the US

23411c Road & Highway Services in the US

Provided to: Edeska (2129455405) | 11 November 2019

About this Industry
Additional Resources For additional information on this industry

www.concrete.org
American Concrete Institute
www.ascconline.org
American Society of Concrete Contractors
www.enr.com
Engineering News-Record
www.asphaltpavement.org
National Asphalt Pavement Association
IBISWorld writes over 1000 US

industry reports, which are updated
up to four times a year. To see all
reports, go towww.ibisworld.com

WWW.IBISWORLD.COM Concrete Contractors in the US April 2019 4
Industry at a Glance
Concrete Contractors in 2019
Key Statistics Revenue Annual Growth 14–19 Annual Growth 19–24

Snapshot
$48.9bn 4.5% 1.5%
Profit Wages Businesses
$3.4bn $15.3bn 54,102

Revenue vs. employment growth Housing starts
Market Share
There are no major 12 1.6
players in this 1.4
8
industry
1.2
4
% change
Millions
1.0
0
0.8
-4 0.6
-8 0.4
Year 11 13 15 17 19 21 23 25 Year 10 12 14 16 18 20 22 24
Revenue Employment
SOURCE: WWW.IBISWORLD.COM
p. 25
Products and services segmentation (2019)
Key External Drivers 10.9%

Housing starts Other services
Value of private
nonresidential
construction 14.9%
Additions, alterations
Demand from municipal and reconstruction
building construction
Demand from bridge
48.6%
New nonresidential
construction
and elevated highway
construction
Yield on 10-year
Treasury note
25.6%
p. 5
Industry Structure Life Cycle Stage Mature Regulation Level Light

Revenue Volatility Low Technology Change Low
Capital Intensity Low Barriers to Entry Low
Industry Assistance None Industry Globalization Low
Concentration Level Low Competition Level High
FOR ADDITIONAL STATISTICS AND TIME SERIES SEE THE APPENDIX ON PAGE 31

Industry Performance
Executive Summary | Key External Drivers | Current Performance
Industry Outlook | Life Cycle Stage
Executive Summary Concrete is a crucial material for the specialize in more lucrative industrial
construction sector given its use in and commercial contracts. Accordingly,
foundations, walls and floors. As a result, rapid growth in the housing market
performance for the Concrete during the current period was an
Contractors industry is closely tied to important catalyst for revenue growth
that of the broader construction sector. for the bulk of industry businesses. The
Over the five years to 2019, favorable marked increase in demand by nearly
lending rates, improved per capita all downstream markets has also helped
disposable income and record corporate profit margins recover from their low
profit levels have helped bolster level at the outset of the period.
construction activity across several However, the rising price of cement, a
sectors, increasing demand for industry key ingredient in concrete production,
services. Housing starts are expected to has led to increased purchase costs,
increase an annualized 6.2% over the five hindering profitability from expanding
years to 2019. Conversely, unemployment further. Overall, IBISWorld estimates
the average industry profit margin,
measured as earnings before interest
Smalleroperators comprise the majority of and taxes, will reach 6.9% of revenue
in 2019.
total establishments and serve local markets Over the five years to 2024, the
industry is projected to continue
is expected to fall an annualized 10.7% expanding, albeit at a relatively slower
during the same period, boosting the pace. Growth in total construction
need for new office, industrial and expenditure is expected to decelerate
manufacturing space. As a result of these over the next five years, which will make
factors, IBISWorld projects industry rapid industry growth more difficult to
revenue to grow at an annualized rate of sustain. However, rising demand from
4.5% to $48.9 billion over the five years the bulk of the industry’s largest
to 2019, including an anticipated 3.3% downstream markets, including
boost in 2019 alone. forecasted upticks in residential and
Smaller operators comprise the commercial building activity, will
majority of total establishments and continue to support industry revenue
service local markets by laying growth. Overall, steady downstream
foundations and raising walls for new demand is expected to lead industry
construction, particularly for residential revenue to rise an annualized 1.5% to
units. Meanwhile, larger operators $52.8 billion over the five years to 2024.
Key External Drivers Housing starts in the Concrete Contractors industry that
The number of annual housing starts operate in small local areas depend
reflects new construction of both single- heavily on the housing market for
family and multifamily housing units (i.e. demand. As a result, when the number of
homes and apartments). Single-family housing starts increases, industry
homes are typically built on concrete revenue grows. IBISWorld expects
foundations, and concrete is an essential housing starts to increase in 2019,
building material for apartment representing a potential opportunity for
buildings. Additionally, most companies the industry.

Key External Drivers Value of private nonresidential Demand from bridge and elevated
continued construction highway construction
The largest contracts in the industry, such Bridges, tunnels and similar
as those for sporting arenas and infrastructure projects make use of
commercial office buildings, are large amounts of concrete and therefore
nonresidential projects pursued by the generate significant demand for
industry’s largest players. However, most concrete contractors. Investment in
operators in the industry are small-scale these projects is strongly linked to
local operators that rely on single-family federal, state and local government
home construction for the contracts that infrastructure budgets. As bridge and
can accommodate their resources. tunnel construction rises, industry
Therefore, the industry’s major companies demand increases. Investment in
are highly sensitive to fluctuations in bridges and tunnels is expected to
business investment in retail, restaurant, increase in 2019.
manufacturing, warehouse and other
commercial markets. The value of private Yield on 10-year Treasury note
nonresidential construction is expected to Treasury bills are the US government’s
increase in 2019. means for borrowing money and are
generally considered to be very safe
Demand from municipal investments. The yield is generally
building construction considered the lower bound interest
The municipal or institutional building rate paid on short term loans. The
market includes schools, hospitals, yield on a 10-year Treasury note is
prisons and other public facilities. This negatively correlated with revenue
market comprises private and public for the Concrete Contractors industry.
construction projects, such as the This is because as interest rates rise,
expansion of medical facilities or the the return on investment of certain
construction of new public high schools. construction projects shrink, thus
These build-outs make heavy use of discouraging investment in new
concrete and helps drive demand for structures. The yield on a 10-year
industry contractors. Revenue for the Treasury note is expected to increase
Municipal Building Construction industry sharply in 2019, posing a potential
is expected to increase in 2019. threat to the industry.
Housing starts Value of private nonresidential construction
1.6 16
1.4 12
1.2 8
% change
Millions
1.0 4
0.8 0
0.6 -4
0.4 -8
Year 10 12 14 16 18 20 22 24 Year 12 14 16 18 20 22 24

Current The Concrete Contractors industry pours

and sets one of the most important Industry revenue
Performance building materials for modern structures,
8
making it an integral part of the domestic
construction sector. Concrete is used to 6
lay the foundation for buildings of almost 4
any size, from single-family houses to
% change
skyscrapers. Concrete’s strength and 2
durability also makes it an attractive 0
choice for external cladding of
commercial structures, such as banks and -2
malls, while also being used to raise -4
sports arenas. It is additionally used in Year 11 13 15 17 19 21 23 25
massive public works nonbuilding
projects, such as in the construction of SOURCE: WWW.IBISWORLD.COM
bridges and dams. The industry’s wide

range of applications usually grants it a heightened construction activity in both
degree of resistance to specific downturns residential and nonresidential markets.
in any one of its customer segments. Over Overall, IBISWorld expects revenue for
the five years to 2019, industry revenue the industry to increase at an annualized
has continued to rebound from its rate of 4.5% to $48.9 billion over the five
historically low level prior to the years to 2019, including a 3.3% boost in
beginning of the current period alongside 2019 alone.
Primary markets The industry’s primary markets are the most industry contracts are for single-
nonresidential and residential building family home foundation work and small
sectors, which account for an estimated retail-establishment construction.
52.6% and 32.4% of industry revenue, With industry performance strongly
respectively, in 2019. These markets linked to the residential housing market,
include the construction of single-family which comprises the largest singular
homes, apartment buildings, retail market for industry services, the
structures, malls, banks, office buildings, Concrete Contractors industry has
hotels, municipal buildings, industrial expanded over the past five years as
facilities and entertainment buildings, housing starts have increased robustly.
such as sports stadiums. While the Favorable interest rates during the bulk
largest commercial building projects offer of the current period, in addition to
the most lucrative contracts, only the lower unemployment and improved
industry’s biggest companies, such as household finances, have constituted
Baker Concrete Construction Inc. and the main drivers for new housing
Structural Group Inc., have the resources construction, which has benefited
to compete for such ventures. Instead, demand for concrete contractors.
Public spending and While demand from residential and municipal and institutional building
industry structure commercial building markets has largely construction have fallen as a percentage
expanded over the past five years, new of industry revenue as a result of private

Public spending and spending picking up sharply in recent expected to increase an annualized 4.5%
industry structure years. Subcontracting work on highway over the five years to 2019, raising
and road construction projects greatly purchasing costs for industry operators.
continued
benefited from government stimulus Although input costs have been
spending through the American Recovery mounting, industry revenue growth has
and Reinvestment Act of 2009 (ARRA), outpaced the expansion of input costs,
which invested billions of dollars to fund enabling profit margins to widen. At the
highway expansion projects across the outset of the current period in 2014,
country. The ARRA also bolstered profit margins, measured as earnings
demand from bridge and tunnel before interest and taxes, stood at 5.3% of
construction. Public works projects, such revenue for that year as price-based
as the ones previously mentioned, competition among industry operators
require thousands of pounds of concrete, remained widespread. However, as
increasing demand for concrete downstream construction activity picked
contractors. However, indirect up and the pool of contracts increased,
government assistance began to decline price competition among industry
as state and federal governments started operators subsided. Consequently,
to experience budgetary pressures. Over industry profit margins have expanded
the five years to 2019, local and state and are expected to account for 6.9% of
government investment is anticipated to revenue in 2019.
rise an annualized 2.2%; compared with Strong growth in demand during
private investment, this trend has current period and improving
produced relatively stagnant demand for profitability have enticed new operators
industry contractor services from to enter the industry, with the number of
municipalities during the current period, industry enterprises projected to grow at
leading the segment to contract slightly an annualized rate of 1.6% to 54,102
as a share of industry revenue. operators over the five years to 2019.
With construction activity overall Additionally, as construction activity
picking up rapidly, many concrete picked up, many industry operators
contractors have incurred higher began to increase their workforce to
purchasing costs since they must buy the accommodate rising demand.
ready-mix (i.e. cast-in-place) concrete to Consequently, industry employment is
apply at worksites. The price of cement, a expected to rise an annualized 5.3% to
principal ingredient in concrete, is 279,527 workers during the same period.

Industry Revenue for the Concrete Contractors

industry is expected to continue its
the previous period. In particular, rising
interest rates during the outlook period
Outlook upward trajectory over the five years to are expected to induce a slowdown in
2024, albeit at a slower pace compared the housing market, which will likely be
with the previous five-year period. the primary reason behind more modest
Overall, IBISWorld estimates that industry growth. Although concrete has
industry revenue will expand at an already gained dominance as an
annualized rate of 1.5% to $52.8 billion essential construction material and
over the next five years. This more there are few new applications for its
subdued growth represents the use, continued advances in durability
stabilization of key downstream and load strength are expected to further
construction markets, which ballooned solidify its importance across all
rapidly from their historic lows during building markets.
Growing downstream Demand for concreting services in the

markets residential construction market, which The
uptick in housing
comprises the largest singular market
for industry services in 2019, is expected
investment will increase
to continue rising over the five years to demand for smaller-scale
2024. The uptick in housing investment regional contractors
will primarily increase demand for
smaller-scale concrete contractors in
regional markets, while population expansion will likely lower rental
growth and low unemployment will vacancy rates, bolstering demand for
boost the need for new residential new office, retail and warehouse
construction projects. As a result, the buildings that require concrete
number of new housing starts is forecast contractor services. Revenue for the
to climb an annualized 2.8% over the Commercial Building Construction
next five years. However, while housing industry (IBISWorld report 23622a)
growth will remain stable, the number of is anticipated to expand during the five-
housing starts will not eclipse the year period, supporting modest
number of new homes built before the growth in the nonresidential
housing bubble burst. market. Meanwhile, in the smaller
Demand for concreting services from manufacturing and industrial building
the nonresidential building construction market, demand for concreting services
market, which accounts for the majority will likely be focused on formwork for
of industry revenue in 2019, will distribution, warehousing and other
primarily benefit from solid growth in storage facilities, particularly those
the commercial building sector. As the located at transport hubs servicing
labor market remains strong, business interstate or international trade.
Industry profit and As revenue growth continues to outpace Overall, profit, measured as earnings
structure increases in key industry inputs, such as before interest and taxes, is expected to
cement, average industry profit margins represent 6.8% of industry revenue in
are expected to widen marginally. 2024. Amid rising demand and steady

Industry profit and profit growth, industry employment is numbers will remain far smaller than
structure continued expected to grow an annualized 2.1% their prerecession highs. Contractor
to 310,207 workers over the next five outfits of this size primarily serve the
years as operators attempt to build up single-family residential market. As
their capacity to deliver on larger, housing starts continue to increase
more lucrative nonresidential over the next five years, rising demand
construction contracts. Meanwhile, the will attract some industry entrants.
number of industry enterprises is While these new companies may
forecast to increase an annualized 1.7% contend with an uphill battle against
to 58,756 independent businesses well-known local contractors that
during the same period. An increase in survived the housing market’s collapse,
small-scale businesses with fewer than they may be able to win contracts by
five employees each is projected to maintaining the aggressive pricing
support growth in the number of competition that industry veterans will
industry operators, although their be eager to avoid.

Life Cycle Stage Industry performance relies heavily on
the health of construction markets
Concrete is an essential part of modern building
design and has complete market acceptance
Technology change in the industry is limited

Industry Life Cycle The Concrete Contractors industry is in revenue has bounced back more
the mature stage of its life cycle. Demand robustly, leading to above-average
is primarily subject to fluctuations in revenue growth.
Thisindustry investment in the industry’s downstream Technological advancements are
is M
ature construction markets; however, concrete limited to the quality of concrete
as a building material has widespread products (e.g. strength and flexibility)
acceptance and use in the laying of and the construction techniques that
foundations and as a component of walls concreting services use. A fundamental
and exterior cladding for large buildings. change in concrete products is unlikely
Consequently, the industry has a high over the next five years. The use of
level of market acceptance, a key trait of a precast concrete components, such as
mature industry. blocks and pipes, somewhat detracts
Over the 10 years to 2024, industry from industry demand because precast
value added (IVA), which measures the components are set in factories in
industry’s contribution to the overall strictly controlled environments, which
economy, is projected to grow an make for higher strength and resistance
annualized 4.9%. Comparatively, US to heat and cold. However, cast-in-
GDP is forecast to rise at an annualized place concrete, the primary application
rate of 2.1% during the same 10-year of the industry, is not expected to be
period, indicating that the industry is overtaken by precast technologies.
growing faster than the economy as a Overall, characteristics such as
whole. However, the industry’s faster widespread market acceptance, positive
IVA growth is due in large part to the IVA growth and limited technological
industry’s record low level in 2012 prior change place this industry firmly in the
to the outset of the 10-year period; mature life cycle phase; conditions are
since construction industries were expected to remain the same over the
hit harder by the economic downturn next five years, leading the industry to
than the overall economy, industry remain in its mature phase.

Products & Markets

Supply Chain | Products and Services | Demand Determinants
Major Markets | International Trade | Business Locations
Supply Chain KEY BUYING INDUSTRIES

23411b Road & Highway Maintenance in the US
Companies in this industry require concreting services in the construction of pavement
surfaces, pathways and curbing on highways and streets.
23611a Home Builders in the US
Builders demand concreting services in the construction of foundations, driveways and
pathways for new and existing houses.
23621 Industrial Building Construction in the US
Operators in this industry require concreting services in the construction of factories and other
industrial buildings.
23622a Commercial Building Construction in the US
Concreting services are required in the construction of commercial buildings.
23622b Municipal Building Construction in the US
Concreting services are used in the construction of institutional buildings.
23731a Road & Highway Construction in the US
Concreting services are used in the construction of pavement surfaces, pathways and curbing
on highways and streets.
23731b Bridge & Elevated Highway Construction in the US
Companies in this industry require concreting services in the construction of bridges and
tunnels.
KEY SELLING INDUSTRIES

32732 Ready-Mix Concrete Manufacturing in the US
Companies in this industry manufacture and supply ready-mixed concrete.
32739 Precast Concrete Manufacturing in the US
Manufacturers in this industry supply prestressed and precast concrete products.
42371 Tool & Hardware Wholesaling in the US
This industry supplies small personal building tools.
42381 Construction & Mining Equipment Wholesaling in the US
This industry supplies heavy construction machinery and equipment used by concrete
contractors.
44419 Lumber & Building Material Stores in the US
This industry supplies building materials such as cement and aggregate.
Products and Services Product offerings in the Concrete building material for structural uses,
Contractors industry are highly including foundations, slabs, walls,
homogenous. Nearly 90.0% of total beams and floors.
revenue is generated in this industry
through the laying and smoothing of New residential construction
cast-in-place (CIP) concrete, a process in Traditionally, concrete contractors are
which concrete is poured into a mold or employed early in the home building
set constructed on-site. CIP concrete is process when the unit’s foundation is put
transported in ready-mix or unhardened in place. An operator’s role in this
form, usually in a truck agitator that process is determined by its size and
spins the concrete to prevent it from specialization. Smaller operators simply
setting. CIP concrete is the standard pour and set concrete after the land has

Products & Markets
Products and Services Products and services segmentation (2019)

continued
10.9%
Other services
14.9%
Additions, alterations
and reconstruction
48.6%
25.6%
Total $48.9bn SOURCE: WWW.IBISWORLD.COM
been cleared and excavated, while larger skyscrapers, storage facilities or

businesses supplement their revenue structures used in transportation
from concrete pouring by assisting in the projects, such as airport terminals. Over
excavation and land development phases the five years to 2019, revenue generated
of construction. In recent years, concrete from this segment has remained
contractors have expanded their role in relatively stable amid mixed results in the
the building process amid the increasing market’s subsectors. Revenue for the
popularity of concrete homes. While this Commercial Building Construction
work does not account for a significant industry (IBISWorld report 23622a) is
share of revenue, it does represent a expected to increase an annualized 8.7%
prospect for segment growth moving over the five years to 2019, supporting
forward, which is a novelty for a mature robust demand for industry services in
industry. Overall, new residential commercial buildings. However, demand
construction work has grown over the from the municipal market has stagnated
past five years as the housing market has over the past five years as persistent
exhibited robust growth. In 2019, new budget deficits at the state level have
residential construction is expected to hindered investment at the subnational
generate 25.6% of total industry revenue. level, thus reducing overall spending on
publicly owned, nonresidential projects.
Nonresidential building construction Additions, alterations and reconstruction
includes: office buildings, hospitals, Repair work is typically done on roads,
factories, power plants, mining shafts, driveways, sidewalks and other exposed
communication lines, farms and concrete. Industry operators benefit from
railroads. In 2019, new nonresidential steady demand for long-term facilities’
construction is expected to account for maintenance and repairs, which
48.6% of total industry revenue. Within consumers generally cannot put off for
this segment, industry participants too long. With increasing levels of new
typically act as subcontractors to a large construction activity, repairs’ share of
general contracting firm; these firms revenue has fallen slightly over the past
compete for lucrative construction five years. In 2019, revenue generated
projects, such as erecting large from this segment is expected to

Products & Markets
Products and Services comprise 14.9% of total industry revenue. ports, energy infrastructure and plants
continued As commercial and residential markets and other large-scale public works, such
pick up over the next five years, this as dams and aqueducts. In 2019,
product segment is forecast to continue IBISWorld expects that other services
to shrink marginally. However, if new will generate 10.9% of total industry
infrastructure spending bills focus on revenue. This segment has fallen slightly
repairing existing roads and bridges, as a share of revenue over the past five
rather than solely erecting new years as government investment in
structures, this segment may outperform infrastructure grew at a slower pace than
current forecasts. demand from the expanding commercial
and residential construction markets.
Other services Over the five years to 2024, however, this
This service segment primarily includes segment is expected to grow at an
applying CIP concrete for highways and accelerating rate amid increased federal
roads, heavy industry structures like spending on transportation.
Demand Residential building construction according to the type of building. Key

Determinants The bulk of demand from the residential short-term factors influencing investment
market is derived from the single-family decisions include prevailing interest
housing market and includes the laying of rates, expected general economic growth
slab foundations, flooring, steps, and the taxation treatment of building
pathways, driveways and patios. Key investments compared with other types
factors influencing demand for residential of assets. Investment in office
construction are those determining the construction is principally determined by
underlying demand for housing, such as growth in the service sector workforce,
demographic factors (e.g. household office vacancy rates and the replacement
formation and population size, growth, rate of existing office stock, as well as
mobility and immigration) and the age of foreign investment inflow. Meanwhile,
housing stock, as well as short-term investment into manufacturing building
economic factors like the affordability of construction activity is principally
housing (e.g. housing prices, interest rates determined by trends in domestic
and household income). Demand for manufacturing production, changes in
special trade construction services in the production technologies, industry
housing construction market is also decentralization and the vacancy rates
affected by one-off factors, such as damage of existing stock. Overall, over the five
to existing property by natural disasters years to 2019, the value of private
(e.g. hurricanes, forest fires and nonresidential construction is expected
earthquakes). Over the five years to 2019, to increase at an annualized rate of 1.1%,
total investment in residential which has boosted demand for industry
construction has increased significantly in services in this market.
line with favorable macroeconomic
conditions and unprecedentedly low Heavy engineering construction
interest rates. Key factors determining long-term
demand for highway, street, spillway and
Nonresidential building construction dam and other engineering construction
Factors influencing demand for include demographic trends affecting
nonresidential construction vary demand for urban infrastructure such as

Products & Markets
Demand roads, water and sewerage; new private- advances in concrete materials and
Determinants sector developments in the mining, components (particularly steel reinforced
manufacturing, recreation and tourism concrete and shotcreting) have
continued
industries; and the aging of existing contributed to a long-term trend of
capital stock. Short-term determinants substitution of concrete for traditional
of investment in engineering building materials (e.g. steel, timber,
construction include public sector asphalt and ceramics).
capital expenditure programs, interest
rate levels and expected yields on Product and labor substitution
investments, as well as government Product substitution has occurred, with
policies that affect private-sector on-site concrete casting being replaced by
investment decisions in the mining and concrete products that are precast in the
manufacturing industries (e.g. taxation factory. Concreting contractors are
policies and tariff reform policies). required to place and finish the precast
concrete products, although the required
Technological advancements labor content of such construction is
Technological advancements have lower. External competition for the
directly stimulated demand for concrete specialist contractors of this industry has
contracting services. Improvements in increased for concreting work done on
on-site concrete construction techniques construction sites, primarily stemming
have resulted in a higher quality product from the in-house staff of general
(e.g. tilt-wall slabs) that is produced more building contractors or from other
efficiently in terms of time and cost. construction trades (e.g. carpenters and
Meanwhile, continued technological flooring contractors).
Major Markets Major market segmentation (2019)

0.9%
Other nonresidential
building construction 12.3%
Municipal building
construction
12.7%
Industrial building construction
32.4%
Residential building construction
15.0%
Nonbuilding construction
26.7%
Commercial building construction
Total $48.9bn SOURCE: WWW.IBISWORLD.COM
Like many other specialty trade including both nonresidential building

construction industries, services offered and nonbuilding construction. The
by the Concrete Contractors industry are nonresidential building market includes
provided to both the residential and commercial buildings (e.g. retail,
nonresidential construction markets, restaurants, hotels, movie theaters,

Products & Markets
Major Markets warehouses, storage units and sports However, because of the conditions
continued arenas); manufacturing facilities and building materials are exposed to over
other industrial warehouses; and the course of some infrastructure’s
municipal buildings (e.g. hospitals, lifetime, such as extremely high or low
schools and religious buildings) for which temperatures or constant water erosion,
concrete contractors build foundations, precast concrete is somewhat more
walls, steps and flooring. Collectively, the common in this market. Precast concrete
industry generates the majority of its is set in factories in a controlled
revenue from work performed in the environment and can be made to very
nonresidential building market, which is specific load and environmental-
expected to account for 52.6% of industry resistance requirements; it is then
revenue in 2019. delivered to the worksite pre-fabricated.
Concrete contractors primarily use ready-
Commercial building construction mix concrete and set the concrete at the
Commercial construction is the largest worksite, and while the installation and
nonresidential submarket for industry finishing of precast concrete is included
contractors, accounting for 26.7% of in the industry, it is a less labor-intensive
annual industry revenue in 2019. This service and generates less revenue for
segment includes work performed on industry contractors.
retail and office buildings, restaurants,
hotels, movie theaters, warehouses, Municipal building construction
storage units, sports arenas and other Municipal buildings for public use
commercial building structures. generate an expected 12.3% of industry
Lucrative commercial construction revenue in 2019. Typical buildings
contracts, such as those for professional projects in this segment include concrete
sporting stadiums, are aggressively bid contracting services for public schools,
for by the industry’s largest contractors. libraries, government offices, prisons,
These projects are undertaken by police stations, fire stations and other
national- or global-scale general recreational areas designated for public
contractors, who in turn hire use. The majority of government
subcontractors with the resources to projects are financed through state and
complete thousands of square feet of local governments. Over the five years to
concrete application. This market 2019, local and state government
segment has increased as a share of investment is anticipated to rise an
revenue over the past five years as annualized 2.2%, resulting in heightened
private-sector commercial construction demand for industry contractor
picked up alongside higher corporate services from municipalities during the
profit and increased economic activity. five-year period.
Industrial building construction Residential building construction

Concrete work for manufacturing The residential market for concrete
facilities and industrial plants comprises contractors includes single-family homes
an estimated 12.7% of the total industry and multifamily apartment buildings and
market in 2019. Though there are complexes. Industry activity in this
typically few projects in this market each market mainly involves laying slab
year, they are highly valuable because of foundations, flooring, steps, pathways,
the large volume of concrete required and driveways and patios. Given this
specialist applications needed, such as segment’s low barriers to entry and
shotcrete used for nonstandard designs. fragmented nature, it is a particularly

Products & Markets
Major Markets competitive segment and is dominated by highways, roads, streets, sidewalk and
continued small-scale local contractors. However, parking lot paving as well as heavy and
most single-family home contracts are civil engineering construction, account
smaller and less lucrative, leading the for an estimated 15.0% of the total
industry’s largest operators to focus their industry market in 2019. While asphalt
efforts on winning contracts for large paving activities are included in the Road
projects in other markets. As most and Highway Construction industry
industry businesses are small, local (IBISWorld report 23731a), this industry
players that focus on contracting for subcontracts concrete workers. This
homebuilders, IBISWorld estimates that market segment is largely determined by
the residential construction market government spending at the federal, state
accounts for 32.4% of total industry and local levels. Over the five years to
revenue in 2019, comprising the largest 2019, this segment is expected to have
singular market for industry services. declined as a share of industry revenue.
Over the past five years, this market With federal funding for large highway
segment has risen as a share of industry and street projects largely tapering out
revenue in line with steady growth in during the current period, this segment
housing starts. has struggled to match its historical
performance, particularly relative to
Nonbuilding construction strong activity in the industry’s
Nonbuilding construction, which is downstream residential and
nonresidential in nature and includes nonresidential building markets.
International Trade Specialty contractors in the Concrete neighboring markets like Mexico or
Contractors industry primarily service Canada, but all revenue generated
local markets and do not import or in another country is considered a
export goods or services. The part of that country’s industry rather
industry’s largest companies may be than the domestic Concrete
able to compete for projects in Contractors industry.

Products & Markets
Business Locations 2019
West
AK
0.3 New
England
ME
Great Mid- 0.8
Lakes Atlantic 1 2
NY 3
WA MT ND 3.6
5 4
3.4 1.0 MN
Rocky
1.0 2.8
WI
OR Mountains SD
1.1
Plains 3.0 MI
3.3
PA
3.6
6
7
1.5 ID IA OH 9 8
1.5 WY 4.0
0.5
NE
2.7
IL IN WV VA
4.1 2.6 2.3
West NV
1.5 0.3
KY
UT MO
1.5 NC
0.6
2.0 CO KS 2.7 2.6
2.8 1.6 TN
SC
Southeast
1.6
CA 1.1
8.9
OK AR GA
1.6 0.8 AL 2.3
AZ MS 1.0
1.9 NM
0.6 Southwest 0.4
TX LA
0.8 FL
7.0 6.5
West Establishments (%)
HI Less than 3%
0.3 Additional States (as marked on map) 3% to less than 10%
1 VT 2 NH 3 MA 4 RI 10% to less than 20%
0.3 0.6 1.4 0.3 20% or more
5 CT 6 NJ 7 DE 8 MD 9 DC
1.0 1.7 0.3 1.6 0.1

Products & Markets
Business Locations Establishments operating in the Concrete

Distribution of establishments vs. population
Contractors industry are dispersed
throughout the United States generally in
30
line with the distribution of the national
population and economic activity. As
most industry operators are small 20
companies that work in the residential
market, employee concentration, which
%
reflects nonemployers as well as 10
employers, is somewhat stronger in
regions with highly active housing
markets, such as the Southeast and 0
Western regions.
West
Great Lakes
Mid-Atlantic
New England
Plains
Rocky Mountains
Southeast
Southwest
However, the Southeast region holds
the highest number of industry
establishments at 20.9% as a result of its
size and level of economic activity; this Establishments
region accounts for 25.7% of the national Population
population. The region includes Florida, SOURCE: WWW.IBISWORLD.COM
home to an estimated 6.5% of industry

establishments, which contains several which is in line with its 14.5% share of the
large metropolitan areas and active national population. Within this region,
housing markets such as the Miami- Ohio, which is a hub for the growing
South, Tampa-West and Orlando-East natural gas industry, is home to the
Central regions. greatest concentration of industry
The West region is home to 15.0% of establishments at 4.0%.
industry establishments and 17.3% of The Plains region accounts for the
the national population, making it fourth-largest concentration of industry
the second-largest concentration of establishments, estimated at 13.3% of the
industry operations. The region total, while only containing 6.6% of the
includes, which comprises 8.9% of domestic population. The large
industry establishments contains a large concentration of industry establishments
portion of the population at 12.1%. in this region can be attributed to the
Furthermore, California has many shale boom occurring in the area,
affluent households, making the state requiring concrete contractors to cement
more likely to generate new housing wells along with building lodging for the
demand as well as home renovations workers. Within the Plains region, North
requiring concrete contractors. Dakota has experienced particularly
The Great Lakes region is home to the explosive growth in population due to
third-largest concentration of industry drilling for natural gas in the state’s
establishments, estimated at 16.9%, Bakken shale.

Competitive Landscape
Market Share Concentration | Key Success Factors | Cost Structure Benchmarks
Basis of Competition | Barriers to Entry | Industry Globalization
Market Share Like most specialty contracting commercial projects. The vast majority
Concentration industries, the Concrete Contractors of companies run only one location
industry is characterized by a low level of and the average enterprise has five
market share concentration. The largest workers. According to the latest data
Level
operator in the industry, Baker Concrete from the US Census, an estimated
Concentration in Construction, has an estimated market 77.1% of establishments employ fewer
this industry is L ow share of just 2.6% in 2019. Additionally, than 10 workers. While the industry’s
the four largest industry enterprises largest companies are national in scale
account for less than 10.0% of total and employ upward of 1,000 people,
industry revenue this year. As a whole, they compete primarily for highly
the industry is largely composed of lucrative public works and large-scale
small-scale enterprises that operate in a private contracts like sports stadiums,
single local area, serving as leaving competition in local markets to
subcontractors on residential or small the area contractors.
Key Success Factors Ability to expand and curtail operations Having a good reputation
rapidly in line with market demand Having an established reputation
Construction work is highly seasonal, as among potential clients for high
IBISWorld identifies bad weather can prevent on-site work. It standards in quality, timeliness
250 Key Success is also highly cyclical, with construction and efficiency is key.
Factors for a cycles depending on economic activity.
business. The most Contractors must be able to cut costs Ability to clearly specify requirements
when demand is low. to suppliers/contractors
important for this
Successful operators are adept at
industry are: Ability to compete on tender specifying the appropriate attributes
Much of this industry’s work is obtained and quantities of ready-mix concrete
through open tendering. Successful input to construction. Reducing waste
operators position themselves to win improves margins, and correct
tenders at rates sufficient to maintain specifications result in superior
profit margins. concrete strength and application.
Cost Structure Profit years across all sectors, profit margins have
Benchmarks The average profit margin, measured as expanded despite rising purchase costs.
earnings before interest and taxes, for Over the five years to 2024, IBISWorld
operators in the Concrete Contractors foresees continued room for growth in
industry is estimated to reach 6.9% of profit margins as demand remains steady
revenue in 2019. Profitability has improved and the price growth of key inputs does
for the industry over the five years to 2019, not accelerate.
up from 5.3% in 2014. Intense price
competition among local operators and Wages
large-scale, national contractors, as well as Concrete work is labor intensive, and
steadily rising purchasing costs, kept although concrete contractors typically
average profit constrained prior to the make more use of heavier equipment and
outset of the period. However, with rising machinery (e.g. truck agitators and
construction activity over the past five shotcrete guns) than other specialist

Cost Structure contractors, wage costs far outweigh capital specialists because high volumes of
Benchmarks investment in the industry. Total wage aggregate, cement, gravel and sand must be
costs amount to an estimated 31.2% of bought to lay concrete. Contractors also
continued
industry revenue in 2019, up from 27.1% of buy wooden framing supplies and rebar to
revenue in 2014. Wages have largely risen construct the sets for laying unhardened
as a share of industry revenue during the concrete. Ready-mix concrete used for
five-year period as growth in total wages cast-in-place applications, the most
has outpaced the industry’s revenue important input for the industry, has
expansion. Since most workers in this grown more expensive during the current
industry are employed on an as-needed period. Over the five years to 2019,
basis, as the amount of work picks up, IBISWorld estimates that the price of
workers’ hours are rise in turn, leading to cement will increase at an annualized rate
higher total labor costs. Wages proportion of 4.5%, including a 3.3% increase this year
of revenue is expected to fall slightly over alone. Additionally, although most industry
the five years to 2024 as demand for operators serve as subcontractors on
industry services normalizes and a projects organized by general contractors,
forecasted increase in purchase costs leads some outsource work to third-parties.
other cost structure segments to rise as a These subcontractor costs are also included
share of revenue relative to wages. in overall purchases, though they are far
smaller than the cost of materials. Indeed,
Purchases materials costs are estimated to comprise
Purchase costs are higher for concrete the bulk of total purchase costs for industry
contractors than other construction operators at just over 75.0%. In 2019, total
Sector vs. Industry Costs
Average Costs of
all Industries in Industry Costs
sector (2019) (2019)
100
5.5 6.9 n Profit
n Wages
n Purchases
20.2 n Depreciation
80
31.2 n Marketing
n Rent & Utilities
n Other
Percentage of revenue
60
51.8
40
48.7
20 1.2 2.8 0.5

2.1 0.2
18.0 4.4
0
6.5

Cost Structure purchase costs are estimated to account for percentage of revenue are expected to
Benchmarks 48.7% of industry revenue. Over the next continue to remain relatively stable for
five years, the prices of key construction industry operators.
continued
materials are expected to continue rising.
Accordingly, total purchase costs for Other costs
industry contractors are expected to Since most industry work is performed
increase slightly. on-site, rent and utilities costs are low for
industry operators, accounting for a
Depreciation combined 4.4% of revenue in 2019.
The Concrete Contractors industry is Additionally, most work is won through a
relatively capital intensive for a specialty tender process or through word-of-
labor industry. Overall, depreciation costs mouth recommendation, rather than by
account for an estimated 2.1% of industry formal advertising; as a result, marketing
revenue in 2019, having remained nearly costs account for just 0.2% of total
unchanged from their 2014 levels. revenue. Other costs, including general
Operators’ capital expenses include business overhead, repair expenses and
transportation, such as truck agitators for insurance costs, combine to comprise the
keeping ready-mix concrete in an remaining 6.5% of total revenue. These
unhardened form, and specialty miscellaneous costs have remained
equipment like shotcrete guns and relatively stable as a proportion of
pneumatic air compressors. Over the next industry revenue over the past five years,
five years, depreciation costs as a increasing in line with revenue.
Basis of Competition Competition in the Concrete Contractors a competitive edge and win work from a
industry is largely based on reputation, much smaller pool of contracts. For
Level & Trend experience, price and capacity or services more specific kinds of work, such as
offered. Most companies in the industry repairs and patchwork or new
ompetition
C in this are small, employing five workers on construction in nonstandard designs,
industry is H
ighand average, and compete for residential or concrete equipment is often needed and
the trend is S teady retail construction projects. The largest contractors who offer this service have
contractors have a national presence, an edge over those who do not.
enabling them to bid on highly lucrative Industry competition has been
public works and large-scale private steadied over the past five years as more
projects like sports arenas and stadiums. construction projects have broken
Since the basic services offered by ground. In fact, over the five years to
industry contractors are largely 2019, the number of housing starts is
homogenous, a company’s reputation, expected to increase an annualized
portfolio of past work and previous 6.2%. However, pricing power has
customers’ testimonials can be more adjusted slowly since property
important in winning a bid than price. developers have come to expect lower
During construction slumps, this prices. Reputation and experience are
situation reverses, with price becoming likely to once again be deciding factors
much more important as contractors in choosing a winning bid over the
aggressively undercut one another to gain next five years.

Barriers to Entry The Concrete Contractors industry is

characterized by low barriers to entry, Barriers to Entry checklist
Level & Trend with the high level of competition in Competition High
local markets being the primary Concentration Low
arriers to Entry
B deterrent. Start-up costs are low for the Life Cycle Stage Mature
in this industry are most part, with the majority of Capital Intensity Low
Lowand S teady contractors working on small scale Technology Change Low
residential jobs. The larger the job, the Regulation and Policy Light
more expensive it is to enter the Industry Assistance None
business; for example, industry
companies that specialize in parking SOURCE: WWW.IBISWORLD.COM
garages will need to buy large mixing

trucks, costing more than $100,000, industry operators must understand
whereas small companies putting in basic architecture to ensure the stability
concrete slabs for residential use can of the building; this usually involves
rent trucks for a fraction of the costs. employing an engineer. Even though
There are no nationwide formal specialized labor such as engineers may
qualifications or licensing requirements be required, the bulk of workers in this
for working in the industry, although industry are laborers who are generally
some states issue licenses. easy to employ. New entrants can also
Other barriers for potential entrants compete more easily in niche
include specialized knowledge of the applications, such as decorative concrete
concrete contracting business. Since work or shotcrete repair and patchwork.
concrete is the basis for foundations of These barriers are not expected to change
large office buildings and homes, significantly over the next five years.
Industry The Concrete Contractors industry of concrete contractors is negligible.

Globalization exhibits a low level of globalization. As a result, the majority of industry
There are no imports or exports in revenue is generated within the
Level & Trend the industry, and foreign ownership United States.
lobalization
G in this
industry is L owand
the trend is S teady

Major Companies
There are no Major Players in this industry | Other Companies
Other Companies The Concrete Contractors industry equipped to bid for lucrative public works
comprises many small-scale companies and entertainment-market projects, such
operating in geographically limited as bridges and sports arenas. However,
markets, and the majority of companies regardless of size, industry players are
employ fewer than five workers. typically hired as the subcontractor for a
However, several specialty concrete building project and are employed by the
contractors have achieved a national project’s general contractor. The
presence and are able to compete across exception to this is in specific, small-scale
a geographic region or several regions. applications, such as the installation of a
These larger operators are also better concrete driveway for an existing home.
Other Company Headquartered in Oxford, OH, Baker The company’s contracts have
Performance Concrete Construction Inc. (Baker) included large projects across the
began in 1968 as a small, privately industry’s downstream markets,
owned cement business, handling including shopping centers, multifamily
Baker Concrete placement and finish work in the local residential apartment buildings, sports
Construction Inc. residential market. Over the following stadiums and hospital expansions. The
Market Share: 2.6% 50 years, the company has expanded company has also completed
operations to include light commercial superstructures for industrial build-outs
and industrial projects, super-flat and parking garages. Baker’s work on the
industrial floors, tunnel form Florida Marlins’ baseball stadium earned
construction and tilt-up construction. a Gold Leadership in Energy and
Baker now operates 13 regional offices in Environmental Design Certification,
nine states and is licensed to operate in which recognizes structures for their
48 states altogether. Baker is green qualities. The stadium was the first
consistently ranked among the top five retractable-roof facility in the world to
contractors in Concrete Construction receive the designation. IBISWorld
magazine’s “America’s Concrete expects that Baker will control a 2.6%
Contractors” list. Furthermore, data industry market share in 2019 as
provided by Engineering News-Record continued commercial construction
(ENR) reveals that the company activity, particularly in the healthcare
generated $1.0 billion in revenue in 2017 sector, drives demand for large-scale
(latest data available). concrete work.
Other Company Based in Hanover, MD, Structural Group corrosion control and water intrusion
Performance Inc. (Structural) is privately owned and prevention services; and SPS
comprises several diversified companies, infrastructure, which provides concrete
including Structural Preservation restoration, commercial roofing and
Structural Group Systems Inc., one of the largest specialty waterproofing services.
Inc. contractors focusing on structural repair Structural operates across the United
Market Share: 1.4% and strengthening; VSL, which operates States, as well as in Singapore and in the
in the post-tensioning market; Pullman, Middle East. In recent years, the
which focuses on chimney, silo and stack company has expanded its operations
construction, maintenance and repair; through strategic acquisitions in key
Electro Tech CP, a specialty provider of regional markets. For example, the

Major Companies
Other Company company completed the acquisitions of Furthermore, data provided by ENR
Performance four companies within the Topcor reveals that the company generated
Companies brand, a provider of $540.0 million in revenue in 2017 (latest
continued
structural restoration and protection data available). IBISWorld estimated that
services, in 2016. Structural has company revenue will control a 1.4%
consistently been ranked among the top industry market share in 2019 as a result
five in Concrete Construction’s of improving commercial and municipal
“America’s Concrete Contractors” list. construction markets.
Other Company Founded in 1912, Ceco Concrete place concrete work, 40.0% from
Performance Construction LLC (Ceco) is a formwork industrial concrete work and the
subcontractor specializing in site-cast remaining 10.0% from slab and
concrete projects. The company has foundation work. Concrete
Ceco Concrete established a reputation for its work on Construction’s “America’s Concrete
Construction LLC sports stadiums, including the Rose Contractors” list has consistently ranked
Market Share: 1.2% Garden Arena, Scottrade Center and Ceco among its top five concrete
EverBank Field. Ceco also operates in the contractors in the nation. Furthermore,
commercial, municipal, multifamily data provided by ENR indicates that the
residential and industrial markets. The company generated $468.7 million in
company currently operates 20 locations revenue in 2017 (latest data available).
nationwide and is headquartered in IBISWorld expects that rising investment
Kansas City, MO. in commercial and multifamily
According to Concrete Construction residential buildings will enable the
magazine, 50.0% of Ceco’s total revenue company to control a 1.2% share of total
is generated from commercial cast-in- industry revenue in 2019.
Other Company Founded in 1965 in New London, CT, parking and government sectors. The
Performance S&F Concrete Contractors Inc. (S&F company’s recent projects include work
Concrete) moved to Massachusetts, on the Massachusetts General Hospital
where it was incorporated in 1968. and Ingalls Ice Rink at Yale University.
S&F Concrete Employing nearly 300 workers, S&F According to data provided by ENR, the
Contractors Inc. Concrete operates four divisions: company generated $234.4 million in
Market Share: 0.6% formwork, flatwork, architectural revenue in 2017 (latest data available).
concrete and specialty floor work. S&F In 2019, IBISWorld expects the
Concrete’s client markets include the company to control a 0.6% industry
commercial, institutional, sports, market share.

Operating Conditions
Capital Intensity | Technology & Systems | Revenue Volatility
Regulation & Policy | Industry Assistance
Capital Intensity The Concrete Contractors industry is

characterized by a low level of capital Capital Intensity
Capital units per labor unit
intensity. Operators’ capital expenses
Level
include costs for transportation, such as 0.5
The levelof capital truck agitators for keeping ready-mix
intensity is L ow concrete in an unhardened form, as well 0.4
as specialty equipment like shotcrete 0.3

guns and pneumatic air compressors.
Although concrete workers typically use 0.2
more heavy equipment than other 0.1

specialty construction contractors, the
industry is largely made up of manual 0.0
Economy Construction Concrete
laborers. Within the industry, major Contractors
companies that work on large-scale Dotted line shows a high level of capital intensity
projects like highway and bridge SOURCE: WWW.IBISWORLD.COM
construction usually have higher levels of

capital investment than local contractors large machinery required, industry
that primarily work in the single-family employees still play a major part in the
home construction market. Even with the construction process. On average, a

Capital Intensity concrete contractor is expected to allocate However, some heavy equipment is
continued $0.07 toward capital investment for every essential to performing concrete work,
$1.00 spent on wages in 2019. As an including concrete agitators for
industry that brings tradesmen to a transporting ready-mix concrete. Overall,
worksite, labor is more essential to the industry’s level of capital intensity has
industry operations than machinery; remained relatively stable over the past
accordingly, total wages are estimated to five years and is not expected to change
consume 31.2% of revenue this year. significantly over the five years to 2024.
Technology and The Concrete Contractors industry has range of applications in the building
Systems exhibited a low level of technology industry have substantially benefited
change. Developments in building concrete contractors by opening up
Level technology have contributed greatly to more markets and generating a greater
the long-term trend of substitution of volume of work.
The level
of traditional building materials with Concrete suppliers and concrete
technology concrete (e.g. concrete slab flooring contractors are becoming increasingly
change is L ow replacing timber, tilt-up walls replacing reliant on advanced pumping technology
clay or concrete bricks). Developments to better deliver and distribute ready
such as these have contributed to mixed concrete to construction sites.
significant improvements across Boom pumps, placing systems, trailer
most areas of construction in terms pumps, shotcrete and mortar pumping
of materials, cost efficiency and machines have substantially altered the
time savings. capacity for manufacturers to deliver
Ready-mix concrete suppliers such as concrete and the flexibility for
CEMEX and US Concrete have contractors working on-site. Significant
introduced steady improvements in the developments have also occurred in the
quality of concrete supplied (i.e. actual machinery used for working the
concrete yielding greater durability and concrete (e.g. extruders used in curbing
flexibility), but concrete contractors and channeling and vibrators to “settle”
have shown resistance to these products the concrete). This has given a
as the higher price of these materials competitive advantage to companies
may reduce the contractors’ cost that have invested in such technology,
competitiveness. The increasing though such equipment is generally
versatility of concrete and the broader available for rent.
Revenue Volatility The Concrete Contractors industry has when the residential construction market
experienced a low to moderate level of began its robust recovery. Since then,
revenue volatility over the five years to revenue growth over the five years to
Level
2019. Industry revenue has expanded 2019 has been driven by heightened
The level of each consecutive year during the current demand from both the residential and
volatility is L ow period, widening as much as 7.3% in nonresidential construction markets.
2014 and as little as 1.2% in 2017. Like Increased levels of consumer spending
other downstream construction markets, and corporate profit have led to an
demand for concrete contractors increase in demand from retailers and
remained tepid until the end of 2012, other industries in the broader

Revenue Volatility commercial real estate sector. In Rising demand has enabled price
continued addition, improved disposable income competition among operators to ease,
and favorable lending rates have enabled letting contractors offer higher quotes
an increase in industry demand from without fear of losing a bid. With steadier
home builders. Over the five years to growth anticipated over the next five
2019, housing starts are expected to years, revenue volatility is forecast to
increase at an annualized rate of 6.2%. be smoother.
Regulation and Policy Few states have licensing requirements structures, reinforcing steel protrusions,
specifically for operators in the Concrete post tensioning specifications and
Contractors industry, but contractors practices, use of concrete buckets,
Level & Trend may be subject to broader licensing personal protection equipment, shoring
he level of
T requirements (e.g. certificates for general inspections, lift slab operations and
Regulation is building practitioner). The regulatory ergonomics. Other OSHA regulations
Lightand the environment governing construction address hazards from the use of cement,
activity is varied and complex, covering a curing agents, bond breakers and
trend is S
teady range of issues including building sealants, including hazardous goods
standards, pollution controls and identification, communication, training
occupational health and safety issues. and air monitoring. State and municipal
While compliance with regulations authorities assess and enforce these
generally adds to the underlying cost of regulations. State-based environmental
operating in this industry, in the long protection regulations include
term, it may reduce a business’ monitoring noise emission and litter on
vulnerability to litigation regarding faulty building sites.
workmanship and workplace accidents Model building codes developed by
and may also lower insurance premiums. code organizations encourage uniformity
Health and safety regulations set by in building construction and standards.
the Occupational Safety and Health Specific concrete building codes have also
Administration (OSHA) are detailed with been developed by industry organizations
respect to construction loads for concrete and adopted by various states. These

Regulation and Policy standards include: Building Code Concrete contractors operating mixing
continued Requirements for Structural Concrete machinery are also required to comply
and Structural Plain Concrete; Structural with driver safety standards and vehicle
Design Guide to the American Concrete classification. The National Safety
Institute Building Code; Cracking in Council provides training and
Prestressed Concrete Structures; Design certification for concrete truck operators
of Concrete Buildings for Earthquake & and involves vehicle inspection
Wind Forces; and Code Provisions for techniques, loading, driving skills and
Deflective Control of Concrete Structures. work site safety practices.
Industry Assistance Operators in the Concrete Contractors finance the costs of these stadiums by
industry do not receive any direct giving the owners of these franchises
government assistance in the form of tax breaks and access to funding.
Level & Trend subsidies or tariffs. Most concrete Government assistance to downstream
he level of
T contractors perform work in localized client markets indirectly helps concrete
Industry Assistance areas and source materials from domestic contractors in the aspect that it makes
is N
oneand the manufacturers due to the heavy nature of industry services more affordable.
the product. The industry does not The industry also benefits directly
trend is S
teady
benefit directly from government from trade associations. The primary
subsidies, but customers of the industry industry trade association, the
may receive assistance from the American Society of Concrete
government for work done. This holds Contractors (ASCC), hosts conferences
especially true in disaster areas, making and events and provides a forum for
it easier for customers to afford the members to share expertise and
services provided by the industry. information. The ASCC Safety Council
Subsidies may also be given to local provides guidelines for contractors and
businesses to finance large products, business owners to ensure worker
which are expected to bring revenue and safety on the build site. The Council
jobs to the area. An example of this is the also publishes articles and white papers
building of large professional sporting detailing safety methods and
stadiums; the government helps to techniques for contractors.

Key Statistics
Industry Data Industry Housing
Revenue Value Added Establish- Wages Domestic starts
($m) ($m) ments Enterprises Employment Exports Imports ($m) Demand (Thousands)
2010 36,352.8 10,063.2 52,533 52,391 207,247 -- -- 9,190.7 N/A 586.9
2011 35,592.8 10,438.4 51,095 50,934 194,263 -- -- 8,943.5 N/A 608.8
2012 35,227.4 11,058.5 49,053 48,922 196,723 -- -- 9,050.5 N/A 780.6
2013 36,556.4 12,101.3 48,808 48,676 203,906 -- -- 9,688.5 N/A 924.9
2014 39,216.5 13,385.1 50,076 49,952 216,185 -- -- 10,639.9 N/A 1,003.3
2015 41,751.6 15,486.6 49,954 49,827 228,792 -- -- 11,896.0 N/A 1,111.8
2016 44,700.8 17,312.8 51,181 51,049 249,790 -- -- 13,245.0 N/A 1,173.8
2017 45,233.8 18,322.4 52,481 52,346 260,471 -- -- 14,206.1 N/A 1,202.9
2018 47,378.3 19,039.4 53,481 53,245 270,655 -- -- 14,785.2 N/A 1,297.2
2019 48,925.3 19,700.2 54,398 54,102 279,527 -- -- 15,269.4 N/A 1,353.1
2020 49,881.7 20,142.6 55,312 54,998 286,631 -- -- 15,639.6 N/A 1,408.7
2021 50,598.5 20,491.3 56,230 55,917 292,923 -- -- 15,959.2 N/A 1,450.2
2022 51,372.9 20,873.9 57,138 56,821 299,172 -- -- 16,280.4 N/A 1,489.9
2023 52,063.4 21,213.2 58,110 57,798 304,954 -- -- 16,575.9 N/A 1,524.6
2024 52,770.7 21,536.9 59,064 58,756 310,207 -- -- 16,849.3 N/A 1,555.5
Sector Rank 15/35 11/35 16/35 16/35 12/35 N/A N/A 10/35 N/A N/A
Economy Rank 202/694 151/694 138/694 121/694 124/694 N/A N/A 119/694 N/A N/A
Annual Change Industry Establish- Domestic Housing

Revenue Value Added ments Enterprises Employment Exports Imports Wages Demand starts
(%) (%) (%) (%) (%) (%) (%) (%) (%) (%)
2011 -2.1 3.7 -2.7 -2.8 -6.3 N/A N/A -2.7 N/A 3.7
2012 -1.0 5.9 -4.0 -4.0 1.3 N/A N/A 1.2 N/A 28.2
2013 3.8 9.4 -0.5 -0.5 3.7 N/A N/A 7.0 N/A 18.5
2014 7.3 10.6 2.6 2.6 6.0 N/A N/A 9.8 N/A 8.5
2015 6.5 15.7 -0.2 -0.3 5.8 N/A N/A 11.8 N/A 10.8
2016 7.1 11.8 2.5 2.5 9.2 N/A N/A 11.3 N/A 5.6
2017 1.2 5.8 2.5 2.5 4.3 N/A N/A 7.3 N/A 2.5
2018 4.7 3.9 1.9 1.7 3.9 N/A N/A 4.1 N/A 7.8
2019 3.3 3.5 1.7 1.6 3.3 N/A N/A 3.3 N/A 4.3
2020 2.0 2.2 1.7 1.7 2.5 N/A N/A 2.4 N/A 4.1
2021 1.4 1.7 1.7 1.7 2.2 N/A N/A 2.0 N/A 2.9
2022 1.5 1.9 1.6 1.6 2.1 N/A N/A 2.0 N/A 2.7
2023 1.3 1.6 1.7 1.7 1.9 N/A N/A 1.8 N/A 2.3
2024 1.4 1.5 1.6 1.7 1.7 N/A N/A 1.6 N/A 2.0
Sector Rank 14/35 9/35 11/35 10/35 2/35 N/A N/A 7/35 N/A N/A
Economy Rank 127/694 133/694 238/694 241/694 83/694 N/A N/A 102/694 N/A N/A
Key Ratios Imports/ Exports/ Revenue per Share of the

IVA/Revenue Demand Revenue Employee Wages/Revenue Employees Average Wage Economy
(%) (%) (%) ($’000) (%) per Est. ($) (%)
2010 27.68 N/A N/A 175.41 25.28 3.95 44,346.60 0.06
2011 29.33 N/A N/A 183.22 25.13 3.80 46,038.10 0.07
2012 31.39 N/A N/A 179.07 25.69 4.01 46,006.31 0.07
2013 33.10 N/A N/A 179.28 26.50 4.18 47,514.54 0.07
2014 34.13 N/A N/A 181.40 27.13 4.32 49,216.64 0.08
2015 37.09 N/A N/A 182.49 28.49 4.58 51,994.82 0.09
2016 38.73 N/A N/A 178.95 29.63 4.88 53,024.54 0.10
2017 40.51 N/A N/A 173.66 31.41 4.96 54,540.04 0.10
2018 40.19 N/A N/A 175.05 31.21 5.06 54,627.48 0.10
2019 40.27 N/A N/A 175.03 31.21 5.14 54,625.85 0.10
2020 40.38 N/A N/A 174.03 31.35 5.18 54,563.53 0.10
2021 40.50 N/A N/A 172.74 31.54 5.21 54,482.58 0.10
2022 40.63 N/A N/A 171.72 31.69 5.24 54,418.19 0.10
2023 40.74 N/A N/A 170.73 31.84 5.25 54,355.41 0.10
2024 40.81 N/A N/A 170.11 31.93 5.25 54,316.31 0.10
Sector Rank 6/35 N/A N/A 22/35 6/35 12/35 16/35 11/35
Economy Rank 228/694 N/A N/A 456/694 155/694 469/694 327/694 151/694
Figures are in inflation-adjusted 2019 dollars. Rank refers to 2019 data. SOURCE: WWW.IBISWORLD.COM

Industry Financial Ratios

Apr 2017 - Mar 2018 by company revenue
Apr 2014 - Apr 2015 - Apr 2016 - Apr 2017 - Small Medium Large
Mar 2015 Mar 2016 Mar 2017 Mar 2018 (<$10m) ($10-50m) (>$50m)
Liquidity Ratios
Current Ratio 1.6 1.6 1.6 1.6 1.6 1.5 1.5
Quick Ratio 1.4 1.5 1.4 1.4 1.4 1.4 1.4
Sales / Receivables (Trade Receivables
Turnover) 7.0 6.4 6.6 6.3 7.8 5.9 4.6
Days’ Receivables 52.1 57.0 55.3 57.9 46.8 61.9 79.3
Cost of Sales / Inventory (Inventory Turnover) n/c n/c n/c n/c n/c n/c n/c
Days’ Inventory n/a n/a 0.4 0.4 0.4 0.4 0.4
Cost of Sales / Payables (Payables Turnover) 13.4 14.7 15.7 13.2 15.6 11.8 11.6
Days’ Payables 27.2 24.8 23.2 27.7 23.4 30.9 31.5
Sales / Working Capital 13.1 11.5 14.4 12.6 15.2 11.4 11.4
Coverage Ratios
Earnings Before Interest & Taxes (EBIT) /
Interest 10.6 12.7 11.4 12.0 7.3 15.6 24.9
Net Profit + Dep., Depletion, Amort. / Current
Maturities LT Debt 3.8 2.7 2.9 3.3 2.6 3.7 n/a
Leverage Ratios
Fixed Assets / Net Worth 0.6 0.6 0.7 0.7 0.9 0.6 0.5
Debt / Net Worth 1.5 1.5 1.7 1.5 1.4 1.4 1.7
Tangible Net Worth 32.8 31.5 31.1 31.4 27.6 35.4 35.4
Operating Ratios
Profit before Taxes / Net Worth, % 31.4 37.9 37.0 35.8 31.7 41.2 33.2
Profit before Taxes / Total Assets, % 12.4 15.0 13.6 12.9 11.3 13.4 14.2
Sales / Net Fixed Assets 14.2 14.2 12.6 13.3 10.9 12.9 19.3
Sales / Total Assets (Asset Turnover) 2.8 2.7 2.8 2.7 2.6 2.7 2.7
Cash Flow & Debt Service Ratios (% of sales)

Cash from Trading 20.4 22.5 24.9 23.3 36.1 17.8 13.9
Cash after Operations 5.3 6.1 7.0 6.5 6.7 6.7 5.5
Net Cash after Operations 5.4 6.3 7.1 6.3 6.5 6.5 5.2
Cash after Debt Amortization 1.6 2.2 2.6 1.8 1.9 1.2 2.2
Debt Service P&I Coverage 3.4 3.8 2.9 3.4 3.2 3.3 4.8
Interest Coverage (Operating Cash) 10.8 14.2 11.7 13.9 10.8 17.4 22.7
Assets, %
Cash & Equivalents 15.3 16.4 13.8 14.3 15.9 12.5 12.6
Trade Receivables (net) 41.1 41.4 39.5 39.9 32.7 46.7 51.4
Inventory 2.6 2.1 1.9 2.3 2.8 1.9 1.6
All Other Current Assets 4.8 4.8 4.7 4.8 3.6 6.2 5.5
Total Current Assets 63.8 64.7 59.9 61.3 54.9 67.3 71.0
Fixed Assets (net) 27.2 26.8 30.3 29.3 33.7 26.0 19.2
Intangibles (net) 1.9 2.6 2.1 3.3 3.8 2.4 4.3
All Other Non-Current Assets 7.1 6.0 7.7 6.1 7.6 4.3 5.5
Total Assets 100.0 100.0 100.0 100.0 100.0 100.0 100.0
Total Assets ($m) 3,567.6 3,513.6 4,224.1 4,827.8 432.8 1,595.7 2,799.3
Liabilities, %
Notes Payable-Short Term 9.5 9.5 7.4 9.6 12.1 7.5 4.8
Current Maturities L/T/D 3.8 4.2 4.8 5.4 6.6 4.5 3.2
Trade Payables 18.4 17.7 16.2 16.4 12.4 20.7 20.3
Income Taxes Payable 0.4 0.3 0.2 0.2 0.1 0.2 0.2
All Other Current Liabilities 10.0 11.1 12.2 11.1 9.3 11.3 18.8
Total Current Liabilities 42.0 42.7 40.8 42.6 40.5 44.2 47.2
Long Term Debt 18.5 18.7 22.0 19.1 24.2 14.5 10.8
Deferred Taxes 0.5 0.4 0.5 0.3 0.3 0.4 0.3
All Other Non-Current Liabilities 4.4 4.0 3.4 3.3 3.6 3.1 2.0
Net Worth 34.7 34.1 33.2 34.7 31.4 37.8 39.7
Total Liabilities & Net Worth ($m) 3,567.6 3,513.6 4,224.1 4,827.8 432.8 1,595.7 2,799.3
Maximum Number of Statements Used 403 409 412 439 228 162 49
Source: RMA Annual Statement Studies, rmahq.org. RMA data for all industries is derived directly from more
than 260,000 statements of member financial institutions’ borrowers and prospects.
Note: For a full description of the ratios refer to the Key Statistics chapter online.

Jargon & Glossary
Industry Jargon CAST-IN-PLACE CONCRETEAlso known as ready-mix SHOTCRETEA sprayed concrete or mortar that involves
concrete. Concrete that is kept in an unhardened form the premixed ingredients (including water) pumped
to be applied at a construction site and set to the through a nozzle and blown by compressed air into a
required surface area or shape. substrate; also called wet-mix shotcrete.
PRECAST CONCRETEConcrete formed and set in a
factory in certain shapes. Precast concrete usually has
higher tolerances for weight, heat, cold and moisture
because it is formed under controlled conditions.
IBISWorld Glossary BARRIERS TO ENTRYHigh barriers to entry mean that INDUSTRY CONCENTRATIONAn indicator of the
new companies struggle to enter an industry, while low dominance of the top four players in an industry.
barriers mean it is easy for new companies to enter an Concentration is considered high if the top players
industry. account for more than 70% of industry revenue.
CAPITAL INTENSITYCompares the amount of money Medium is 40% to 70% of industry revenue. Low is less
spent on capital (plant, machinery and equipment) with than 40%.
that spent on labor. IBISWorld uses the ratio of INDUSTRY REVENUEThe total sales of industry goods
depreciation to wages as a proxy for capital intensity. and services (exclusive of excise and sales tax); subsidies
High capital intensity is more than $0.333 of capital to on production; all other operating income from outside
$1 of labor; medium is $0.125 to $0.333 of capital to $1 the firm (such as commission income, repair and service
of labor; low is less than $0.125 of capital for every $1 of income, and rent, leasing and hiring income); and
labor. capital work done by rental or lease. Receipts from
CONSTANT PRICESThe dollar figures in the Key interest royalties, dividends and the sale of fixed
Statistics table, including forecasts, are adjusted for tangible assets are excluded.
inflation using the current year (i.e. year published) as INDUSTRY VALUE ADDED (IVA)The market value of
the base year. This removes the impact of changes in goods and services produced by the industry minus the
the purchasing power of the dollar, leaving only the cost of goods and services used in production. IVA is
“real” growth or decline in industry metrics. The inflation also described as the industry’s contribution to GDP, or
adjustments in IBISWorld’s reports are made using the profit plus wages and depreciation.
US Bureau of Economic Analysis’ implicit GDP price INTERNATIONAL TRADEThe level of international
deflator. trade is determined by ratios of exports to revenue and
DOMESTIC DEMANDSpending on industry goods and imports to domestic demand. For exports/revenue: low is
services within the United States, regardless of their less than 5%, medium is 5% to 20%, and high is more
country of origin. It is derived by adding imports to than 20%. Imports/domestic demand: low is less than
industry revenue, and then subtracting exports. 5%, medium is 5% to 35%, and high is more than
EMPLOYMENTThe number of permanent, part-time, 35%.
temporary and seasonal employees, working proprietors, LIFE CYCLEAll industries go through periods of growth,
partners, managers and executives within the industry. maturity and decline. IBISWorld determines an
ENTERPRISEA division that is separately managed and industry’s life cycle by considering its growth rate
keeps management accounts. Each enterprise consists (measured by IVA) compared with GDP; the growth rate
of one or more establishments that are under common of the number of establishments; the amount of change
ownership or control. the industry’s products are undergoing; the rate of
technological change; and the level of customer
ESTABLISHMENTThe smallest type of accounting unit
acceptance of industry products and services.
within an enterprise, an establishment is a single
physical location where business is conducted or where NONEMPLOYING ESTABLISHMENTBusinesses with
services or industrial operations are performed. Multiple no paid employment or payroll, also known as
establishments under common control make up an nonemployers. These are mostly set up by self-employed
enterprise. individuals.
EXPORTSTotal value of industry goods and services sold PROFITIBISWorld uses earnings before interest and tax
by US companies to customers abroad. (EBIT) as an indicator of a company’s profitability. It is
calculated as revenue minus expenses, excluding
IMPORTSTotal value of industry goods and services
interest and tax.
brought in from foreign countries to be sold in the
United States.

Jargon & Glossary
IBISWorld Glossary VOLATILITYThe level of volatility is determined by WAGESThe gross total wages and salaries of all
averaging the absolute change in revenue in each of the employees in the industry. The cost of benefits is also
continued past five years. Volatility levels: very high is more than included in this figure.
±20%; high volatility is ±10% to ±20%; moderate
volatility is ±3% to ±10%; and low volatility is less than
±3%.

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WWW.IBISWORLD.

COM Concrete Contractors in the USApril 2019 1

Rock solid: Acceleration of the nonresidential

IBISWorld Industry Report 23811

2 About this Industry 18 International Trade 28 Revenue Volatility

www.ibisworld.com | 1-800-330-3772 | info @ibisworld.com

About this Industry

Main Activities The primary activities of this industry are

The major products and services in this industry are

Similar Industries 23814 Masonry in the US

23834 Tile Installers in the US

23833 Flooring Installers in the US

23891a Excavation Contractors in the US

32732 Ready-Mix Concrete Manufacturing in the US

23731a Road & Highway Construction in the US

23411b Road & Highway Maintenance in the US

23411c Road & Highway Services in the US

Provided to: Edeska (2129455405) | 11 November 2019

About this Industry

Additional Resources For additional information on this industry

IBISWorld writes over 1000 US

Provided to: Edeska (2129455405) | 11 November 2019

Key Statistics Revenue Annual Growth 14–19 Annual Growth 19–24

$3.4bn $15.3bn 54,102

Key External Drivers 10.9%

Industry Structure Life Cycle Stage Mature Regulation Level Light

Provided to: Edeska (2129455405) | 11 November 2019

Provided to: Edeska (2129455405) | 11 November 2019

Housing starts Value of private nonresidential construction

Provided to: Edeska (2129455405) | 11 November 2019

Current The Concrete Contractors industry pours

bridges and dams. The industry’s wide

Provided to: Edeska (2129455405) | 11 November 2019

Provided to: Edeska (2129455405) | 11 November 2019

Industry Revenue for the Concrete Contractors

Growing downstream Demand for concreting services in the

Provided to: Edeska (2129455405) | 11 November 2019

Provided to: Edeska (2129455405) | 11 November 2019

Provided to: Edeska (2129455405) | 11 November 2019

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Products & Markets

Supply Chain KEY BUYING INDUSTRIES

KEY SELLING INDUSTRIES

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Products & Markets

Products and Services Products and services segmentation (2019)

Total $48.9bn SOURCE: WWW.IBISWORLD.COM

been cleared and excavated, while larger skyscrapers, storage facilities or

Provided to: Edeska (2129455405) | 11 November 2019

Products & Markets

Demand Residential building construction according to the type of building. Key

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Products & Markets

Major Markets Major market segmentation (2019)

Like many other specialty trade including both nonresidential building

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Products & Markets

Industrial building construction Residential building construction

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Products & Markets

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Products & Markets

Business Locations 2019

COM Concrete Contractors in the USApril 2019 1