WWW.IBISWORLD.

COM

SpecialReportApril 2012  1

Top10Fastest-GrowingIndustries

Special Report April 2012

Top 10 FastestGrowing Industries

ByLaurenSetar&MatthewMacFarland

With environmentally friendly practices or technological advances, these industries are outpacing the economic recovery.
Consumer concerns about health and the environment bode well for some industries
Across the United States, industries, businesses and consumers are climbing out of the Great Recessions lows. US gross domestic product is forecast to grow 3.3% per year over the next five years, a welcome change from the meager growth of 0.6% per year between 2007 and 2012. Some industries, however, arent just recovering theyre flourishing. IBISWorld has compiled a list of these standout industries based on their contributions to the economy as a whole (measured as industry value added), absolute revenue growth and establishment growth over the past 10 years, as well as performance expected through 2017. Whether by focusing on environmentally friendly practices and operations or benefiting from technological advances, these industries are expected to continue their meteoric rise and far outpace the rest of the economy. Thinking green Over the past decade, the dramatic rise in energy costs and an increasingly vocal, environmentally conscious public have led to the growth of green industries. The Solar Panel Manufacturing industry has been at the forefront of the green industrial movement with average annual revenue growth of 32.3% from 2002 to 2012, including expected growth of 9.4% in 2012. As the federal government looks to reduce the United States dependency on fossil and other non-renewable fuels, green energy firms have reaped the benefit of substantial subsidies. Without assistance, solar power generation firms would have little chance against entrenched, traditional fuel sources. Moreover, falling silicon prices have allowed US firms to compete with low-cost manufacturers abroad. Over the next five years, revenue for the Solar Panel Manufacturing industry is expected to continue expanding at an average rate of 8.2% per year. The construction industries were early victims of the Great Recession, but the Green and Sustainable Building Construction industry capitalized on the green movement and weathered the downturn well. Since 2002, industry revenue has experienced annualized growth of 28.9% and anticipated 18.3% growth in 2012. Firms in the industry construct energy-efficient buildings that are often largely composed of sustainable materials. Aided by local and state building codes that promote the use of energy-efficient building design and materials, demand for green construction has skyrocketed. Government programs

www.ibisworld.com|1-800-330-3772|info @ibisworld.com

WWW.IBISWORLD.COM

SpecialReportApril 2012  2

Top10Fastest-GrowingIndustries

like Leadership in Energy and Environmental Design (LEED) and Energy Star have also driven demand forward. Over the five years to 2017, revenue for the Green and Sustainable Building industry is expected to grow at an average annual rate of 22.8%. Taking care Along with their heightened concern for the environment, Americans are increasingly seeking ways to become and stay healthy. Consumer awareness of the harmful effects of UV ray exposure and the prevalence of skin cancer has led to the rapid emergence of the Self-Tanning Product Manufacturing industry, which has experienced average annual revenue growth of 22.7% per year since 2002.

With the dangers of tanning beds foremost in many consumers minds a study by the National Cancer Institute found that tanning lamps and beds can more than double the risk of skin cancer self-tanning products have become more popular. Heightened interest in such products has led to more innovation. Todays offerings produce a more natural tan for a wider range of skin tones. In 2012, revenue for the SelfTanning Product Manufacturing industry is expected to grow 18.1%, with average annual growth of 10.7% projected over the next five years. Consumers are also seeking alternative ways to stay fit. The Pilates and Yoga Studios industry provides health-minded Americans with conditioning routines

ForecastIndustryRevenue
Industry Generic Pharmaceutical Manufacturing Solar Panel Manufacturing For-Profit Universities Pilates & Yoga Studios Self-Tanning Product Manufacturing 3D Printer Manufacturing Social Network Game Development Hot Sauce Production Green & Sustainable Building Construction Online Eyeglasses & Contact Lens Sales 2012 ($m) 52,785.2 4,610.5 27,019.6 6,853.3 609.3 1,698.5 2013 ($m) 56,959.4 5,029.7 28,326.2 7,170.6 688.3 2,019.7 2014 ($m) 61,683.9 5,563.8 29,601.2 7,538.4 775.3 2,323.4 2015 ($m) 65,877.3 5,901.5 30,451.3 7,962.5 858.3 2,656.3 2016 ($m) 69,458.5 6,578.0 31,286.9 8,319.4 940.6 2,956.2 2017 ($m) 72,682.2 6,827.5 32,225.0 8,643.8 10,10.7 3,265.2 MajorIndustryPlayers Teva Pharmaceutical Industries Ltd. Watson Pharmaceuticals Inc. Sandoz Ltd. Mylan Inc. SunPower Inc. Apollo Group Inc. DeVry Inc. Career Education Corporation No Major Players Kao Brands Company 3D Systems Corporation Stratasys Inc. Z Corporation Zynga Inc. Electronic Arts Inc. The Walt Disney Company McIlhenny Company Reckitt Benckiser PLC The Turner Corporation 1-800-Contacts.com Walgreen Company Coastal Contacts Inc.
SOURCE: WWW.IBISWORLD.COM

4,548.3 1,077.4 103,052.2 347.7

6,000.0 1,139.5 124,693.1 390.7

7,920 1,198.2 156,115.7 428.1

9,820.8 1,213.5 199,359.8 464.1

11,293.9 1,273.1 245,411.8 491.9

12,310.4 1,318.6 287,867.9 530.3

WWW.IBISWORLD.COM

SpecialReportApril 2012  3

Top10Fastest-GrowingIndustries

focused on building strength and flexibility. From 2002 to 2012, the industry grew an average of 12.1% per year and is projected to expand 5.1% in 2012. Pilates and yoga studios were highly resistant to the recession; instead of facing negative growth in 2008 and 2009, revenue merely slowed. In the five years to 2017, industry revenue is expected to grow at an average annual rate of 4.8%. Emerging technologies The accelerating speed and accessibility of the internet has led to skyrocketing growth for web-based industries. Over the past five years, social networks, in particular, have become an integral part of life for many consumers, connecting them with others and helping them find a cheap alternative source of entertainment. The Social Network Game Development industry owes its existence to these needs, and as sites like Facebook have grown exponentially, so too have social network game developers: Since 2002, this industry grew an average annual 128.0% The industrys games are usually free to play; developers earn revenue through the sale of virtual goods that enhance game-play and through advertisements shown onscreen. Unlike most of the economy, the recession was a boon for the industry because under- or unemployed consumers spent extra leisure time with these low-cost games rather than with expensive console games or software. In 2012, industry revenue is expected to grow 20.0%, and over the next five years, revenue is projected to grow at an average annual rate of 22.0%. As the speed and security of online monetary transactions grow, online retail for more products will become commonplace. Eyeglasses and contacts are increasingly being sold through online stores thanks to the higher prevalence of broadband internet in households. Between 2002 and 2012,

Forecast Revenue Growth

35 30 25

% change

20 15 10 5

Year 12

13

14

15

16

17

Green & Sustainable Building Construction Social Network Game Development 3D Printer Manufacturing Self-Tanning Product Manufacturing Online Eyeglasses & Contact Lens Sales Solar Panel Manufacturing Generic Pharmaceutical Manufacturing Pilates & Yoga Studios Hot Sauce Production For-Prot Universities
SOURCE: WWW.IBISWORLD.COM

revenue in the Online Eyeglasses and Contact Lens Sales industry has grown 28.2% on average annually; in 2012, revenue is expected to grow 11.9%. New technologies, such as virtual try-on systems in which shoppers upload a picture to see how frames look on their faces before ordering a pair, have made customers more confident in their online purchases. Over the next five years, industry revenue is expected to grow 8.8% per year on average. Rapid technological advances, falling costs and a greater need for new medical devices have led to the growing presence of 3D printing, a process in which successive layers of material are laid down until the product is finished. 3D printers allow the manufacturer to create something from precise schematics in a single build process. The 3D Printer Manufacturing industrys revenue has grown an average of 8.8% per year since 2002, with 20.3% growth expected in 2012 alone. As the cost of producing

WWW.IBISWORLD.COM

SpecialReportApril 2012  4

Top10Fastest-GrowingIndustries

About IBISWorld Inc.

Recognized as the nations most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit www.ibisworld.com or call 1-800-330-3772.

these high-tech machines decreases and printer technology is refined, they will be used for an increasing number of applications, such as aerospace-related part manufacturing. With the rapid pace of innovation already present in the industry, double-digit annualized growth (14.0%) is projected to continue into the next five years. Other upstarts In 2012, the For-Profit Universities industrys revenue is projected to grow 5.0%, and over the next five years, revenue will grow an estimated 3.6% per year on average. As more and more high school students seek a college education after graduating, gaining admission to traditional public and private universities has become more difficult. At the same time, state budget cuts have shortened the resources these institutions can use to cope with the influx of students. Stepping in to alleviate the heightened demand for higher education, for-profit universities have become a common sight in education in the United States; since 2002, the For-Profit Universities industry grew an average of 13.6% annually. Classes taught at for-profit universities are often accessed through alternative means to the classroom, such as through TV programming or the internet. The low cost of teaching online classes has been particularly essential to the rapid growth of these institutions. Moreover, with the high unemployment caused by the recession, workers and high school graduates without a job chose to continue their education rather than combing the job market. Independent of state budgets and able to avoid the high tuition costs of private schools, for-profit schools grow by selling shares to investors. The Generic Pharmaceutical Manufacturing industry has found sustained growth over the past 10 years,

Contact: SavannahHaspel
VP, Public Relations IBISWorld Phone: 1-310-866-5044 savannahh@ibisworld.com www.ibisworld.com

with average annual revenue growth of 9.6%. As the median age of the US population increases, more consumers require a greater amount of prescription drugs. Generic drugs are sold without patent protection and tend to be cheaper than brand-name drugs, making them more attractive in the face of rising overall healthcare costs. Many industry operators have closed inefficient plants and removed redundant sales positions to cut costs, expanding profit margins. However, as more consumers qualify for private insurance, insurance providers will gain more leverage to negotiate lower drug prices, which could reduce the industrys profit margins. Still, revenue is expected to continue rising, with 8.1% growth expected in 2012 and average annual growth of 6.3% projected through 2017. The Hot Sauce Production industry has heated up over the past 10 years, with average revenue growth of 9.3% per year and expected 2012 growth of 4.5%. While the recession did cool the industrys prospects, rebounds in 2010 and 2011 reestablished it as a rapidly growing part of the food sector. Demand for hot sauce has been driven by demographic consumption trends, immigration and international demand from Canada, the United Kingdom and Japan. As Americans palates have become more diverse, hot sauce has earned tenure on the dinner table. Demand from supermarkets and grocery stores has reflected the change in consumer taste, and food retailers are dedicating more shelf space to ethnic cuisine. Ethnic supermarkets also growing rapidly more prominently offer a variety of hot sauces than more traditional stores. Hot sauce production isnt expected to burn out any time soon: Over the next five years, industry revenue is projected to grow at an average annual rate of 4.1%.

www.ibisworld.com|1-800-330-3772|info @ibisworld.com

At IBISWorld we know that industry intelligence is more than assembling facts. It is combining KeyExternalDrivers continued data with analysis to answer the questions that successful businesses ask.
Identifyhighgrowth,emergingandshrinkingmarkets Armyourselfwiththelatestindustryintelligence Assesscompetitivethreatsfromexistingandnewentrants Benchmarkyourperformanceagainstthecompetition Makespeedymarket-ready,profit-maximizingdecisions

WhoisIBISWorld? We are strategists, analysts, researchers and marketers. We provide answers to information-hungry, time-poor businesses. Our goal is to give you the real-world answers that matter to your business in our 700 US industry reports. When tough strategic, budget, sales and marketing decisions need to be made, our suite of Industry and Risk intelligence products give you deeply researched answers quickly. IBISWorldMembership IBISWorld offers tailored membership packages to meet your needs. Join and become an industry expert!

Disclaimer
This product has been supplied by IBISWorld Inc. (IBISWorld) solely for use by its authorized licenses strictly in accordance with their license agreements with IBISWorld. IBISWorld makes no representation to any other person with regard to the completeness or accuracy of the data or information contained herein, and it accepts no responsibility and disclaims all liability (save for liability which cannot be lawfully disclaimed) for loss or damage whatsoever suffered or incurred by any other person resulting from the use of, or reliance upon, the data or information contained herein. Copyright in this publication is owned by IBISWorld Inc. The publication is sold on the basis that the purchaser agrees not to copy the material contained within it for other than the purchasers own purposes. In the event that the purchaser uses or quotes from the material in this publication in papers, reports, or opinions prepared for any other person it is agreed that it will be sourced to: IBISWorld Inc.

Copyright 2012. IBISWorld Inc.