US HVAC Services Market Size & Share Analysis - Growth Trends and Forecast (2026 - 2031)

US HVAC Services Market Trends and Insights

Aging Building Stock in OECD Markets Requiring Upgrades

The median commercial building in the United States was 44 years old in 2025, and many structures erected before 1980 still rely on single-stage rooftop units that lack variable-speed drives, economizers, or modern controls.^{[1]U.S. Energy Information Administration, “Commercial Buildings Energy Consumption Survey,” eia.gov} Energy use by those legacy units runs 30%-40% above code-minimum systems, which pressures landlords in cities with disclosure mandates to commit capital to HVAC retrofits. Institutional investors now price carbon intensity into property valuations, so ESG compliance is another trigger. The Infrastructure Investment and Jobs Act allocated USD 3.5 billion for public-sector upgrades that often serve as templates for private owners.^{[2]U.S. Department of Energy, “DOE Announces USD 3.5 Billion to Make Federal Buildings More Energy Efficient,” energy.gov} Retrofit urgency is highest in the Northeast and Midwest where heating loads dominate, though Sun Belt buildings also pursue upgrades to manage peak cooling demand.

Mandatory Refrigerant Phase-Downs Driving Retrofit Demand

The American Innovation and Manufacturing Act targets an 85% cut in hydrofluorocarbon production by 2036, propelling the transition from R-410A toward lower-GWP A2L blends such as R-32 and R-454B. Because A2L refrigerants require sensors, ventilation, and spark-safe components, most existing equipment cannot simply be recharged, so owners face a retrofit or replacement decision well ahead of normal life cycles. ASHRAE Standard 15 drives up installation cost by USD 2,000-USD 5,000 for detection gear.^{[3]ASHRAE, “Standards and Guidelines,” ashrae.org} California and several Northeastern states front-loaded compliance deadlines to 2028, compressing project schedules and crowding service pipelines.

Expansion of Hyperscale Data-Center Build-Outs

United States hyperscale operators earmarked USD 200 billion for new capacity in 2025 with AI workloads pushing rack densities beyond 50 kW, a regime that traditional air-cooled CRAC units cannot economically manage. Liquid cooling makes inroads, yet precision air handling still serves most colocation halls and demands 24/7 service coverage. Technicians in Virginia’s Loudoun County, Texas’s Dallas-Fort Worth, and Arizona’s Phoenix area command premiums of 15%-20% over residential counterparts because downtime penalties trigger heavy liabilities. Cybersecurity vetting now factors into vendor selection as attacks on building-automation networks could trigger thermal events.

HVAC-as-a-Service Contracts Unlocking Annuity Revenues

Outcome-based contracts bundle equipment, installation, energy, and maintenance into a predictable monthly fee, moving HVAC spending from CapEx to OpEx. Johnson Controls indicated that 18% of 2025 North American bookings fell under this model, up from 11% two years earlier. Federal agencies received 2025 guidance endorsing energy-savings performance contracts, teeing up a wave of public-sector opportunities. The model’s success hinges on IoT sensors streaming data that fuels predictive analytics, letting providers dispatch crews before failures unfold.

Skilled-Labor Shortages and Escalating Wage Bills

HVAC employment is projected to add 23,000 roles from 2024-2034, but attrition will create 35,000 openings annually, leaving a sizable gap.^{[4]U.S. Bureau of Labor Statistics, “Heating, Air Conditioning, and Refrigeration Mechanics and Installers,” bls.gov} Median hourly wages climbed to USD 28.50 in 2025, while A2L-certified master technicians topped USD 40. Labor now exceeds 55% of total project cost, up from 48% in 2020. Apprenticeships expand, yet four-year training requirements delay relief. Contractors deploy augmented-reality guidance and remote diagnostics to boost productivity, but wage inflation still squeezes margins, especially for smaller firms.

Volatile HVAC Component Supply and Material Inflation

Semiconductor shortages doubled lead times for variable-frequency drives and electronic expansion valves to 16 weeks in early 2025. Copper prices jumped 22% the same year, inflating the cost of refrigerant piping and coils. A Thailand factory fire sidelined one of the three dominant global scroll-compressor suppliers, exposing single-point-of-failure risk. Distributors enlarged inventories, but higher carrying costs ultimately flowed to customers as elevated service fees.

Segment Analysis

By Implementation Type – Retrofit Buildings Capture Sustained Upgrade Cycles

Retrofit buildings contributed 58.49% of 2025 revenue and are forecast to rise at 6.23% through 2031, reinforcing their role as the growth engine of the US HVAC services market. The US HVAC services market size for retrofit projects is expanding as owners race to replace R-410A systems ahead of the EPA phase-down calendar, creating a retrofit wave that overlaps with normal end-of-life milestones. ESG mandates tie asset values to operational carbon, so capital partners increasingly insist on variable-speed compressors and smart controls that lower kWh per square foot. Prefabricated modular kits, craned into place in a single day, slash disruption and let contractors deliver more jobs per crew per month.

New construction trails at a 5.40% CAGR yet still benefits from stronger design-build coordination. Developers in growth metros specify heat-recovery VRF systems that improve tenant comfort and differentiate Class A properties. Federal funding for public buildings steers toward retrofits, but ground-up healthcare and industrial facilities keep new-build pipelines active in Sun Belt states.

By Service Type – Energy-Efficiency Retrofits Outpace Break-Fix Work

Maintenance and repair retained the largest share at 46.15% in 2025, yet the highest momentum sits with energy-efficiency and retrofit services, advancing 7.03%. The US HVAC services market size for optimization projects benefits from utility rebates that buy down payback to three years or less. Controls upgrades climb 6.50% as buildings migrate from stand-alone thermostats to IP-connected platforms. Installation services face commoditization in residential split-system changeouts, motivating contractors to pivot toward bundled commercial scopes that fold in commissioning and multi-year service.

Consulting and other advisory work accelerates as owners seek third-party audits before allocating capital. Energy-savings performance contracts, now endorsed for federal facilities, enable providers to front the cost and recover investments from verified kWh reductions, reshaping revenue recognition.

By System Type – Ventilation and IAQ Services Gain Post-Pandemic Momentum

Cooling still dominated with 42.58% of 2025 revenue, but ventilation and IAQ leads in growth at 6.76%. Revised ASHRAE Standard 62.1 elevates outdoor air rates by 30% for high-density spaces, encouraging demand-controlled ventilation retrofits that balance air quality with energy spend. Healthcare clients specify MERV 13 and HEPA filters, creating annuity contracts for quarterly replacements. Heating services move gradually toward air-source heat pumps in cold climates where incentives close the cost gap with gas furnaces.

Integrated building-management services rise 6.20% as portfolios bundle HVAC with lighting, elevating cyber-risk profiles that drive service providers to add network segmentation to routine maintenance.

By End User: Industrial Facilities Accelerate Amid Reshoring

Residential accounted for 55.48% of 2025 demand, fueled by a vast installed base of single-family homes, yet industrial is the fastest at 6.88%. The US HVAC services market share held by industrial clients is growing due to biotech, semiconductor, and e-commerce warehouses that require precise thermal control. Pharmaceutical plants mandate ±1 °F tolerance zones, and logistics centers run HVAC year-round to protect automated picking systems.

Commercial tenants in office and hospitality properties continue to outsource maintenance to landlords under triple-net leases, producing fragmented, lower-ticket contracts. Residential growth steadies at 5.50% as smart thermostats and filter-delivery subscriptions deepen lifetime value per home.

Note: Segment shares of all individual segments available upon report purchase

By Application Vertical – Data Centers Lead as AI Workloads Surge

Data centers captured 23.71% of 2025 revenue and race ahead at 6.92%. The US HVAC services market size inside data halls benefits from racks above 50 kW that force specialized cooling topologies. Service contracts guarantee sub-hour response times and embed cybersecurity audits. Liquid cooling is still emergent, so precision air systems with redundant CRAH units dominate near-term demand.

Healthcare follows at 6.50% as hospitals retrofit isolation rooms and upgrade filtration. Education rises 6.20% on bond-funded upgrades to aging campuses, while hospitality prioritizes VRF systems that align with guest comfort metrics. Retail defers large upgrades, but preventive maintenance keeps doors open without capital outlays.

Geography Analysis

The US HVAC services market generates the lion’s share of North American revenue because building codes, licensing, and refrigerant regulations are distinctly national, cementing domestic providers’ competitive edge. Sun Belt states log the heaviest cooling workloads, and contractors in Texas, Arizona, Florida, and Georgia handle 20%-25% more summer service calls than the national mean. Wage premia intersect with heat-driven demand, so technicians in Dallas-Fort Worth often earn 15% above peers in cooler zones. Retrofit urgency spikes in California where the state bans high-GWP equipment sales after 2028, driving owners to lock in changeouts ahead of supply bottlenecks.

Northeast and Midwest metros focus on heating systems, especially boiler modernization that aligns with winter load profiles. Heat-pump adoption climbs as incentives cover 25%-35% of install cost, narrowing payback gaps. In Virginia’s Loudoun County, the density of hyperscale campuses compounds labor shortages, so service vendors offer signing bonuses to secure A-level technicians.

Canada layers climate extremes onto service demand. Alberta and Saskatchewan see long heating seasons, while British Columbia’s mild coast creates balanced service portfolios. Ottawa’s CAD 2.6 billion Greener Homes Grant, worth USD 1.9 billion, funds residential retrofits that mirror US weatherization programs. Mexico remains installation-centric, yet industrial plants along the northern border import US maintenance standards, slowly professionalizing the local service ecosystem.