The top 10 dying industries in the United States
A new report (pdf) from IBIS World looks at 10 industries in the United States that are demonstrating, as the researchers put it, “exceptionally sour performance.” Some are suffering from trade competition, some — like video rental — from the advent of new technology. Here’s the list:
2. Newspaper publishing
3. Appliance repair
4. DVD, game, and video rental
5. Money market and other banking
6. Recordable media manufacturing
7. Hardware manufacturing
8. Shoe and footwear manufacturing
9. Costume and team uniform manufacturing
10. Women’s and girls’ apparel manufacturing
The ranks of the endangered are dominated by clothing manufacturing. That’s not because people have stopped wearing footwear or team uniforms. Rather, manufacturers have been moving their plants overseas in the past decade, to China, Vietnam, Indonesia, and Mexico, to save on labor costs. The report notes that the average U.S. worker in girls’ apparel makes $33, 579 — in Indonesia, it’s just $1,089.
Banks, too, make an appearance. Many money-market funds and other unregulated financial firms got wiped out in the financial crisis, and IBIS World expects non-commercial banking to keep declining in revenue in the near future — at an average rate of 0.9 percent over the next five years.
For other industries, the reasons for doom are more subtle. Appliance repair is dying because, as the report puts it, there’s “a rising tendency among consumers to purchase new household appliances rather than repair them.” The price of appliances has fallen at an annual rate of 2.4 percent in the past decade. We’ve reached the point where it’s often easier to buy a new laundry machine than to call in the Maytag repairman.
Other industries have been hit hard by technological advances. Video rental is losing revenue at an average rate of 6.6 percent per year, thanks to Netflix and online streaming. The photofinishing industry has practically imploded — with revenue shrinking at 11.4 percent per year in the past 10 years — thanks to the popularity of digital photography. Newspaper revenue has fallen at a 6.4 percent pace in the last decade as online advertising has proven far less lucrative than print ads. The rise of mp3s has been bad news for the production of older, recordable media like CDs.
Will any of these industries stay alive? Some, like newspapers, are doing what they can to adapt, such as charging for online subscriptions. Others might need to take drastic measures. The report, for instance, suggests that recordable media manufacturers might be able to thrive by producing disks that hold 3D movies. For now, it notes, “pending a major technological breakthrough,” 3D movie files are too large to download or stream. Of course, 10 years from now, when that all changes, we could be reading about the shuttering of plants that make 3D movie disks.
(Link via Conor Dougherty.)