United States / Analyst Insights
Top 10 Industries Expected to Expand in 2019
by Robert Miles, Senior Strategic Industry Analyst
Jan 15 2019

With 2019 underway, now is a better time than any to survey the industry landscape and pinpoint growth prospects for the upcoming year. While IBISWorld’s industry data can highlight growth in several ways, the following analysis will focus on revenue, rather than enterprises and employment, to breakdown 2019 growth. Each growth measure helps to parse out the underlying factors supporting 2019 trends and shed light on varied aspects of the year’s potential.

While analyzing revenue growth movements can highlight overarching industry trends, it is also possible to segment these industries’ performance based on which life cycle stage they fall in. Of the 10 fastest-growing industries in 2019; six are mature, three are in the growth stage and one is in the decline stage. The range of industry types signals how revenue growth is often the result of short-term external factors rather than long-term trends, which can be used to better understand the 2019 growth outlook.

Revenue growth in 2019
The top 10 fastest growing industries in terms of revenue in 2019 cover a wide range of sectors, with rapid growth industries existing in the Manufacturing (IBISWorld report 31-33), Utilities (22), Mining (21), Information (51), Administration (56), Finance and Insurance (52) and Retail (44-45) sectors. One of the most interesting industries in this group is Wind Turbine Manufacturing (33361b), which has benefited from long-running government support. Despite its strong performance in 2019, the expected 17.6% revenue growth masks the features of the industry that place it in the decline stage. Subsidies, which are being phased out, supported an industry that has experienced falling value-added production and is expected to feel the brunt of competition from other energy sources moving forward. The remaining nine industries in the top 10 are either in the mature or growth stage, and while they all appear to be vastly different industries, there are key commonalities between them.

IBISWorld assigns key performance drivers to every industry, which help explain the external economic, demographic or social factors that affect the industry’s revenue. There are 35 unique drivers between the noted top 10 rapidly growing industries. However, the two most common drivers are electric power consumption and the price of natural gas. In 2019, IBISWorld expects the average price of natural gas to be higher than it was in 2018. Conversely, electric power consumption is anticipated to fall off slightly in 2019, as efficiency initiatives and responses to higher prices take hold. Many industries may be affected as a result of these shifts in key driver performance. Industries including, Wind Turbine Manufacturing, Solar Panel Manufacturing (33441c) and Natural Gas Distribution (22121) are all exposed to these factors in varying degrees. Despite an expected drop in consumption, all these industries continue to cannibalize the space left from declining coal energy. Then, between the industries, a rise in natural gas prices is expected to support per-unit sales for distributors while also putting more focus on renewables.

According to IBISWorld estimates, the fastest-growing industry in 2019 will be the Tank and Armored Vehicle Manufacturing industry (33699). The growth expectations are based on projected government outlays on certain projects and current defense spending budgets. Furthermore, the restrictions on imports and the rising price of steel are expected to help sharply increase industry revenue. This factor is also supported by slow growth experienced in 2018, typically when demand is strong, a year of slow growth is matched by a significant rebound. Other areas of fast growth are tied to technology change. Specifically, the Internet Publishing and Broadcasting (51913b) and E-Commerce and Online Auctions (45411a) industries are expected to continue their rapid growth path into 2019, as they continue to become more significant in the economy.

Life cycles and growth
When revenue growth is broken down by life cycle stage, the difference between short-term growth drivers and structural growth drivers becomes more evident. Government budget adjustments, commodity price fluctuations and interest rate movements are expected to drive growth for energy, machinery manufacturing and banking industries, which populate the list of fastest-growing mature industries.

On the other end of the spectrum, the fastest-growing industries in the growth stage of their life cycle are driven by longer-term trends. Both solar (22111e) and wind (22111d) power are a function of renewable energy trends. Home care providers (62161) and elderly and disabled services (62412) growth are a result of an aging US population. Finally, internet publishing and broadcasting, e-commerce and online auctions, dating services (81299a), database, storage and backup software publishing (51121b), data processing and hosting services (51821) and taxi and limousine services (48533) are all tied to the continued expansion of internet connectivity and the saturation of online services.

By breaking down industries based on multiple criteria, key factors that underscore expectations for 2019 can be solidified. Rising commodity prices are expected to help spur growth for mature industries and the prevailing structural forces affecting growth stage industries will continue.


Edited & Designed by Emily Lidstone