Mary Ellen Biery, Research Specialist, Sageworks
Looking to start fresh in 2013 through a new career, new business relationships, or a new company? Sageworks, a financial information company, conducted a financial statement analysis of privately held companies to identify the fastest-growing industries of the last twelve months. These are industries that have seen dramatically higher growth than the average 9 percent sales growth all private companies generated, according to current data by Sageworks.
With manufacturing having played a pivotal role in economic recovery, it's no surprise that several manufacturing industries are among the strongest growing over the last twelve months, based on current estimates.
Machinery equipment wholesalers, machine shops, architectural and structural metals manufacturing, and industrial machinery manufacturing are among the top ten fastest growers.
"It's possible that those are tied together as businesses have started to use some of their cash to invest in needed equipment and upgrades", said Sageworks analyst Brad Schaefer. "All of those took really big hits in 2009 because companies weren't investing in a lot of equipment."
Other industries showing up in the top ten fastest-growing industries over the last twelve months are related to petroleum and other forms of energy. Schaefer noted that the oil boom in the Northwest Plains, increased shallow water drilling in the Gulf of Mexico, and other operations are providing new opportunities for companies to expand their drilling operations.
Support activities for mining, which includes drilling and making geological observations at prospective mineral, oil, and gas sites, grew about 32 percent over the last twelve months. Meanwhile, the high price of oil this year has contributed to 27 percent growth among wholesalers of petroleum and petroleum products and 18 percent growth among gasoline stations.
Through its cooperative data model, Sageworks collects financial statements for private companies from accounting firms, banks, and credit unions, and aggregates the data at an approximate rate of 1,000 statements a day.
Of course, just because an industry has been growing strong for the last twelve months, there's no guarantee that growth will necessarily continue, Schaefer noted. But looking at some of the drivers of recent growth may yield clues on potential future growth.
Schaefer noted that increasing reliance of US companies on computers could have contributed to the nearly 18 percent growth experienced by computer systems design and related services over the last twelve months. This industry has also had steady growth in previous years.
"It's been steady since 2010", Schaefer said. "Even in 2009, when almost all industries had sales declines, computer systems design grew about 4 percent, which usually signifies a stable industry."
Employment services, which has grown sales by about 18 percent over the last twelve months, is another industry that may have some of the same drivers in place, Schaefer said.
"I see the employment services industry doing fairly well again, just because a lot of people are still uncertain about the economy and the political atmosphere, which contributes to businesses hiring temporary or contract workers instead of full-time employees", he said. "I don't think that's something that'll go away for the next year."
About the author:
Mary Ellen Biery is a research specialist at Sageworks, a financial information company and provider of the Business Credit Report by Sageworks. She is a veteran financial reporter whose works have appeared in The Wall Street Journal and on Dow Jones Newswires, CNN.com, MarketWatch.com, CNBC.com, and other sites.