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Changes in the Landscape Industry in New York

Introduction

The paper covers the changes in the landscape industry with specific concern to technological, environmental, and political change the New York state has faced. I own a landscaping business since 2009, and have 5 employees in the state of New York. The following content covers the impact of changes in the landscape industry, and specifically on my business.

Landscape Industry

Operators in this industry plan and design the development of land for projects by applying their knowledge of land characteristics, locations of buildings and structures and use of land areas. Firms work on parks and other recreational areas, airports, highways, hospitals, schools, land subdivisions and commercial, industrial and residential areas.

Industry Life Cycle

The Landscaping Services industry is in the growth phase of its life cycle. Although the industry is growing in line with GDP, the detrimental effects of the recession have kept it from growing faster. While industry value added (IVA) is expected to increase at an average annual rate of 1.6% compared with 1.8% GDP growth in the 10 years to 2016, the industry's contribution to the overall economy (i.e. IVA) is expected to grow considerably faster than GDP over the five years to 2016 (U.S. Census Bureau, pp. 35).

The industry will benefit from new clients during the next five years, which will contribute to growth. One client growth area will be in the aging US population, which will boost the number of people that use landscapers. Many baby boomers are approaching retirement age and their ability to complete landscaping activities is expected to diminish in the years to come.

Operators have also benefited from the increasing trend toward bundled property maintenance services. The move into more services, which helps differentiate service providers, is expected to increase during the next five years. It is also contributing to some consolidation in the upper end of the industry as large firms acquire midsize operators to improve their market reach.

Current Performance

The Landscape industry has endured poor performance in key downstream construction markets during the past five years. The sharp cyclical contraction of investment into the housing construction market had a particularly hard effect on operators. Construction on commercial and institutional buildings also declined, causing larger players to feel the economic pinch. In the five years to 2011, revenue is expected to decline 2.2% per year to $6.0 billion (U.S. Census Bureau, pp. 35).

The depth of the recession and the slump in residential construction severely affected demand for landscape services at the top end of the housing market. During the mid-2000s, the industry experienced relatively strong growth, which was partly fueled by increasing property values. The industry also benefited from the spread of community housing developments with recreational amenities such as golf courses. Unfortunately, the deterioration in housing affordability and the crisis in the home lending market caused new housing starts to come to a standstill, dampening demand for landscaping design services. In 2011, problems are expected to continue in downstream markets, limiting demand growth for landscape. Consequently, industry ...