Want to know what industries are heating up? Industry analyst IBISWorld just released its picks for the 5 hottest startup industries for the next five years. The company analyzed revenues, growth trends and profitability levels of more than 700 industries to determine which ones are best poised to grow.
Even if you are already in business, knowing which industries are in growth mode can give you ideas for new products, services or partnerships that could help your business expand. Here are IBISWorld’s picks:
- Testing and Educational Support: High school graduates are going on to college, college students are clinging to their college years instead of facing the tough job market, and laid-off employees are heading back to school. All this bodes well for testing and education businesses. IBISWorld reports that the industry grew at an average annual rate of 6.2 percent to $15.4 billion over the five years up to 2011, and that level of growth is projected to continue over the next five years, with revenue increasing an average of 5.5 percent per year to reach $19.1 billion in 2016. Trade and technical schools, business coaching and employment recruiting are all related industries with similarly positive outlooks.
- Internet and Technology: No surprise here, but growth in broadband access and the increasing ubiquity of technological devices in our daily lives are driving demand for technology. For entrepreneurs, IBISWorld suggests two opposite paths of opportunity: you can create a highly innovative startup that has a big idea and sufficient capital, or you can provide services to help businesses with their technology needs. Since all kinds of businesses are moving online today, the latter area is rife with opportunity. IT consulting, logistics and order fulfillment, online lead generation, data-mining consulting and online payment processing are some of the services your business can provide.
- Green: Despite the recession, green products and services continue to thrive. Consumers are paying for eco-friendly products and services from clothing to housecleaning, but some of the biggest opportunities are on the business-to-business side. Green consultants who help businesses shrink their carbon footprints are poised to grow, as new regulations will increase the need for experts to advise businesses. In fact, IBISWorld projects the environmental consulting industry will grow 9.4 percent per year to $30.0 billion by 2016. Another growth industry: providing remediation and environmental cleanup services, such as removing hazardous waste or cleaning up wastewater.
- Residential and Commercial Construction: IBISWorld says this industry is ready to bounce back from the recession; the report projects the value of residential construction will rise 12.5 percent annually in the five years to 2016 and the value of private non- residential construction will rise by about 13.0 percent annually during that time. In addition to increased demand for contractors, there will be a need for specialty subcontractors such as drywall and glass contractors or architectural and building inspection services. And over the five years to 2016, IBISWorld estimates revenues for the home building industry will grow 16 percent per year to $394.1 billion.
- Health: Alternative providers, such as acupuncturists, masseuses and yoga instructors, will be a growth industry in the coming years. These treatments were already gaining wider acceptance among the public (and health insurance companies) even before last year’s health insurance reform law added provisions to increase support for alternative treatments. The industry’s revenue is forecast to grow by 4.3 percent annually for the next five years, reaching $14.4 billion by 2016. Other industries that will grow thanks to healthcare reform and the aging of America include home care providers, elderly and disabled services and physical therapists.
How could your business take advantage of these trends?
For more about IBISWorld and other industry reports, visit the IBISWorld website.