What are the 10 Fastest Growing Industries in America in 2018? Let’s find out.
There are many different types of industries. Some industries, like railroads, are mature and have been around for a long time. Those types of industries are often consolidated, meaning there are only a few major companies, each of which have considerable market share. Growth in those mature industries is typically slow or even non-existent when factoring out GDP increases. Many investors who own companies in mature industries do so for their steady cash flows and dividend payouts.
Other industries are relatively new and growth in those industries can be very fast. If an industry’s sizzling growth continues for a long time and management that runs those companies execute, the rewards for investors can be rather large. Software development was once one of the fastest growing industries in the world, and the companies that led it, like Microsoft, have handily paid investors for their investment. Shares of Microsoft have arguably been one of the best investments one can make if one started right when Microsoft was growing very quickly.
That being the case, growth can also produce less than fantastic results. Due to the fact that they are in growth mode, many companies are not profitable. Those companies often will need to raise capital either from banks or from equity markets to sustain their growth. Due to the fact that many of those companies are relatively small, many will not be able to compete against corporations with more resources. As with any investment, it’s important to consider both the pros and the cons.
Given the rewards of investing in fast growing industries, we cover the fastest 10 growing industries in America. In terms of the methodology, we use data released last year (and researched for 2016) from Sageworks, a leading financial information company, and assume things won’t change all that much in 2018.
#10 Other Heavy and Civil Engineering Construction
Number ten on our list of 10 Fastest Growing Industries in America in 2018 is Other Heavy and Civil Engineering Construction, which according to SageWorks grew 13% year-over-year in terms of sales change for 2016. Given the strong economy, Other Heavy and Civil Engineering Construction might continue to benefit as local/state governments have more money to spend given higher tax receipts. One thing that could potentially slow profitability in the Other Heavy and Civil Engineering Construction industry might be wage inflation if it accelerates substantially, however.
#9 Nonresidential Building Construction
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Nonresidential Building Construction is number nine on our list, with sales having grown around 13% for 2016. Nonresidential Building Construction is part of the construction of buildings subsector, which according to the BLS ‘may include new work, additions, alterations, or maintenance and repairs’.
#8 Other Specialty Trade Contractors
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Other Specialty Trade Contractors also grew 13% year-over-year for 2016, ranking 8th on the list. Other Specialty Trade Contractors are considered important for construction projects by many.
#7 Building Equipment Contractors
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Building Equipment Contractors sales also rose 13% for 16′, ranking #7. Building Equipment Contractors include things such as installing/servicing equipment such as potentially elevators or escalators.
#6 Other Professional, Scientific, and Technical Services
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Other Professional, Scientific, and Technical Services is an industry on our list that isn’t necessarily construction related. Other Professional, Scientific, and Technical Services sales also grew 13% for 2016.
#5 Foundation, Structure, and Building Exterior Contractors
Foundation, Structure, and Building Exterior Contractors ranks number five on our list. Some investors believe Foundation, Structure, and Building Exterior Contractors could potentially benefit if a major Trump infrastructure bill becomes law. As it stands, it also grew 13% for 2016.
#4 Residential Building Construction
Residential Building Construction sales grew 14% for 2016. That ranks Residential Building Construction as number four on our list. Although rising interest rates could make many mortgages slightly more expensive, a strong economy and a low unemployment rate could help keep residential construction robust.
#3 Building Finishing Contractors
Building Finishing Contractors also grew 14% for 2016. Building Finishing Contractors include insulation and drywall contractors as well as flooring contractors.
#2 Services to Buildings and Dwellings
Services to Buildings and Dwellings is number two on our list, having grown 14% for 2016. Services to Buildings and Dwellings include landscaping services along with exterminating and pest control services.
#1 Computer Systems Design and Related Services
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Computer Systems Design and Related Services is the number one fastest growing industry for the 10 Fastest Growing Industries in America in 2018. Computer Systems Design and Related Services encompasses IT firms that do programming, etc. and is in demand because of the increasing adoption of computer technology among industries around the country.
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