Market Trends of United States (US) MEP Services Industry
This section covers the major market trends shaping the US MEP Services Market according to our research experts:
New Construction to Drive the Market Growth
- As per the Associated General Contractors (AGC) of America, the construction industry is a major contributor to the US economy. The industry has more than 733,000 employers with over 7 million employees and creates nearly USD 1.4 trillion worth of structures each year. Construction is one of the major customers for manufacturing, mining, and a variety of MEP services. It is also seen as a significant economic reviver during the recession period.
- The residential construction sector has been the star performer of the United States’ economic recovery from the COVID-19 crisis, posting double-digit growth rates since the third quarter of 2020 and making significant contributions to the rebound of the economy and the overall construction industry growth. Many construction projects were fast-tracked to utilize the opportunity of the lockdown and resulted in an increased revenue during the COVID-19 phase. Over the forecast period, the market is expected to correct the sudden increase in projects undertaken.
- Moreover, firm revenues are steadily rising, and the bottom lines are still under considerable pressure. Among the challenges that the industry face is sustained cost pressures, ongoing labor shortages that affect productivity, and trends toward fixed-bid projects that often demand a level of pricing and operations precision that is difficult to obtain with traditional systems. While the industry still trails broader digital acceptance maturity, the continued adoption of digital technologies could alleviate some of these issues.
- It can also present additional hurdles in terms of successful implementations and upskilling the workforce to absorb the technologies. Despite these challenges, MEP firms are poised to potentially benefit from various significant industry opportunities, including the US transportation and infrastructure upgrade initiative and the growth of smart city mega-projects.
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Demand from Healthcare Institutions to Drive Market Growth
- The healthcare sector in the region is considered one of the crucial sectors for the optimal functioning of the economy. However, it faces the huge problem of inefficient planning and insufficient resources at the healthcare facilities. For instance, Humana and the University of Pittsburgh researchers reported that based on the data from January 2012 to May 2019, approximately 25% of healthcare spending could be characterized as inefficient.
- Thereby, end-user from the healthcare sector are starting to realize the potential offered by MEP services to leverage inefficiencies in the facilities. Moreover, In a healthcare facility, each department has its specific requirements: operation theatre, Gynaecological Department, or the Paediatrics Department. Additionally, incompetent designs could lead to a catastrophic effect on patient treatment. For instance, low internal air quality could cause adverse effects on the health of the patients. Thus, MEP services hold the potential to support the systems that are the backbone of healthcare operations.
- Furthermore, the ongoing pandemic COVID-19 has showcased the region's lack of preparation to counter the pandemic and has exposed the health system's inefficiencies and inequities. For instance, the healthcare infrastructure cannot accommodate COVID-19 patients and has fewer hospital beds per capita than other developed countries.
- Thereby these instances are expected to surge the demand for MEP service as the government bodies in the region are starting to allocate many resources into the construction of efficient medical facilities. For instance, In May 2020, AECOM announced it had completed the New York City Department of Design and Construction's (DDC) project to construct two temporary hospitals that are aimed to serve as COVID-19 emergency facilities.
