United States (US) MEP Services Market Size & Share Analysis - Growth Trends And Forecast (2025 - 2030)

United States (US) MEP Services Market Trends and Insights

Outsourcing Focus on Core Competencies

Mechanical systems now form 40–60% of building energy loads, encouraging owners to outsource to specialist firms rather than carry in-house teams. Technology platforms such as ServiceTitan help contractors build direct relationships that bypass general-contractor markups, evidenced by Southland Industries’ productivity gains after adopting the platform. Healthcare networks allocate higher portions of capital budgets to specialized partners, with facilities-management spending on non-hospital projects up 27% in 2025. Contractors like Limbach report recurring revenue increases from building-systems solution contracts that improve lifecycle performance.

Sustained Demand from Healthcare Construction

Healthcare construction reached USD 65 billion in 2024 as infection-control protocols and negative-pressure ventilation drove complex mechanical specifications. Projects such as Mayo Clinic’s 1.4 million sq ft expansion in Arizona require redundant HVAC, filtration, and emergency power systems with 24/7 uptime. Hospital owners now specify commissioning on 80% of projects to certify operational readiness, expanding demand for specialized MEP consultants.

Electrification and HVAC Efficiency Retrofits

IRA rebates and state codes are accelerating electrification, with the Department of Energy projecting 900,000 new contractor roles linked to heat-pump rollouts. California’s 2025 Energy Code mandates electric-ready kitchens and higher heat-pump efficiencies, pushing contractors into advanced refrigerant management and electrical-coordination scopes.^{[3]Source: California Energy Commission, “2025 California Energy Code Fact Sheet,” energy.ca.gov} Smart HVAC integration delivers 36.8 kW average power savings per facility when coupled with IoT-driven predictive maintenance algorithms.

Inflation Reduction Act Tax-Credit Pull-Through

Section 25C permits homeowners to recover 30% of qualified mechanical expenditures up to USD 3,200 annually, driving a wave of residential retrofits. Commercial owners leverage uncapped 25D credits for solar-plus-storage that require sophisticated HVAC load management, while states like New York add workforce grants that subsidize heat-pump installer training.

Talent Scarcity and Wage Escalation

The sector faces a gap of 650,000 skilled workers as baby-boom retirements accelerate, leading to 20% wage growth since 2020.^{[4]Source: Autodesk, “Can Better MEP Solve Construction’s Skilled Labor Shortage?,” autodesk.com} Apprentice compensation in energy trades averages USD 77,000 in year one, pressuring bid margins for public-sector contracts. Mechanical contractors in the Midwest report 68% difficulty filling mechanical-engineering positions, forcing 49% of firms to decline projects despite strong pipelines.

Small-Firm Margin Squeeze from Design-Build Consolidation

Strategic acquisitions among national players continued in 2024, exemplified by WSP’s USD 1.78 billion purchase of Power Engineers and Michael Baker International’s takeover of Infinity MEP+S Consultants. Consolidators leverage bulk-buying power to mitigate copper and equipment price spikes, leaving independents vulnerable to material cost inflation that has hit 40% for HVAC equipment since 2020. Smaller entities increasingly pivot toward niches such as hospital retro-commissioning or liquid-cooling integration to preserve pricing power.

Segment Analysis

By Type: Retrofits Dominate IRA-Driven Growth

Retrofit and renovation captured 47.5% of the mechanical services market share in 2024 as building owners raced to secure federal incentives ahead of potential rule changes. Commissioning and re-commissioning are projected to generate USD 4.4 billion of additional mechanical services market size by 2030, posting a 7.7% CAGR as performance verification becomes mandatory for healthcare and public-sector projects.

Performance-based contracts are reshaping service scopes; eighty percent of hospital projects now bundle commissioning, energy modeling, and maintenance analytics into single awards. Digital-twin adoption accelerates verification accuracy, with IFC-based workflows reducing corrective-action lists by 28%.

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

By End-User Vertical: Healthcare Leads Mission-Critical Expansion

Healthcare accounted for 29.1% of the mechanical services market size in 2024, underpinned by USD 2.5 billion in announced medical-campus expansions. Data centers hold a modest 10% revenue slice today, but are the fastest-growing vertical at 8.2% CAGR as AI workloads escalate liquid-cooling adoption.

Commercial-office demand remains resilient as owners upgrade indoor air quality to win back tenants, while educational institutions unlock deferred-maintenance budgets through infrastructure grants. Industrial and warehousing clients invest in high-volume ventilation and process piping to comply with Occupational Safety and Health Administration (OSHA) air-quality limits. Mission-critical campuses, a blended category of hospitals, labs, and hyperscale compute sites, are projected to contribute USD 49 billion to the mechanical services market size by 2025.

By Service Type: HVAC Systems Drive Electrification

HVAC retained 41.5% of the mechanical services market share in 2024, reflecting the technical intensity of heat-pump rollouts and smart controls integration. Electrical Services is expanding at a 7.8% CAGR as jurisdictions adopt outcome-based codes that oblige predictive performance assurance.

Electrical-service demand climbs in parallel, driven by panel upgrades for EV chargers and rooftop solar interconnections. Plumbing and fire protection maintain a steady share because hospital and industrial projects need specialized piping, medical-gas systems, and code-driven sprinkler designs. ASHRAE’s 2024 standards emphasize whole-building system efficiency, compelling mechanical contractors to coordinate envelope, lighting, and HVAC decisions from schematic stages.

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

Geography Analysis

Non-residential spending in the South grew 8.3% year over year, outpacing national averages as corporate capital moved toward right-to-work states with lower energy costs. Data-center developers cluster near high-capacity transmission lines, driving demand for chilled-water plants and high-density power distribution. Population inflows sustain a 4.6% uptick in multifamily starts, providing retrofit opportunities for centralized hot-water and HVAC upgrades across residential towers.

The West posts the highest mechanical services market CAGR at 7.9% as California mandates electric-ready builds and advanced heat-pump coefficients. Rural counties in Oregon and Utah attract hyperscale campuses seeking cool climates for liquid-cooling systems that reduce PUE ratios. Solar-plus-storage microgrids proliferate in wildfire-prone areas, requiring mechanical contractors to coordinate battery thermal-management units and smoke-control fans that meet revised air-quality rules.

The Northeast and Midwest struggle with acute labor gaps yet benefit from healthcare and infrastructure outlays. New York’s clean-energy workforce grants subsidize heat-pump installer certifications, while Illinois’ apprenticeship programs fortify pipefitter and electrician pipelines. Midwest megaprojects, including bio-fuels refineries and small-modular reactor test sites, create specialty work packages for mechanical firms offering combined process and HVAC expertise.