According to a report by IBISWorld, the lawn and outdoor equipment industry has rebounded significantly over the past five years as it has been “propped up by a revival in home improvement spending”. According to Grand View Research, gardening as a hobby is growing thanks to “improving the social lifestyle of a growing base of the affluent middle class population”.
These proclamations sound great if you are in the landscaping industry. However, it would be better if you had some cold hard facts proving that the landscaping products and services market is growing. Here is some evidence to show us that this market is growing.
1. The neighborhoods in the south are growing, as is the landscape market.
According to the US Census Bureau, the median sales price of homes in the south rose an average of 4.03 percent per year between 2008 and 2017, compared to the national average of 3.77 percent.
This graphic shows building permits for single-family homes in the United States. As you can see, the south has been the predominant growth area for at least two years.
More homes to the south are good news for the landscaping industry as clients and clients there need gardening all year round. However, the competition will be fierce. Lawn & Landscape reported that 38 percent of all US-based landscaping service providers are in the south.
According to a 2017 press release from Zillow, “the country’s fastest growing home values have shifted from typical California markets to southern Florida, Texas and Tennessee markets.”
To bring the point home, here’s another graph showing a somewhat steep increase in the number of privately owned housing units that have been completed in the south. One thing to keep in mind is that the homes being built in the area could generate additional clients for landscaping companies over the generations, not just a short-term boom.
2. The increasing number of older Americans will increase the demand for landscaping.
Lawn & Landscape’s 2017 State of the Industry report showed that “an aging population of Baby Boomer customers was a major driver of the increase in business over the past year,” for a landscaping company in Topeka, Kansas. According to the Bureau of Labor Statistics Job Opportunity Guide for Floor Maintenance, “more workers will be needed to keep pace with the increasing demand for lawn maintenance and landscaping services from aging or busy homeowners.” They estimate the total floor maintenance employment to be 1,309,300 in 2016 to 1,455,600 in 2026, or 11 percent.
The following table provides an overview of the aging trend in the US population. We looked at the percentage of the population in Massachusetts that were 55 years of age and older and the percentage of the population in Pennsylvania that was 65 years of age and older. We based our calculations on census data. The percentage increases are not staggering, but they give the impression that the population is more geared towards the older generations. It is more compelling considering that these two states are not popular for retirement.
Some older generation people will not immediately outsource their gardening work. Instead, you will find less stressful ways of doing this yourself. Many outdoor power device manufacturers make electric and battery models for lawn mowers, trimmers, etc. that are easier and safer to use. Some companies even offer robotic lawn mowers that can do the job themselves.
This population is growing in numbers and has enormous purchasing power overall. According to Immersion Active, “70 percent of disposable income in the US is controlled by baby boomers” and they own “80 percent of all money in savings and loan associations.”
Of course, some older people will move to nursing homes over the years, making their positive effects on the landscaping industry seem less significant. However, nursing homes also need landscaping, and there are many of these in the US, with more being built every year. According to the Centers for Medicare & Medicaid Services website, “over the past five years the number of nursing homes has increased in 19 states.” SeniorAdvisor.com states that “over 1.4 million people in the United States are currently receiving long-term care in a nursing home received … that number is expected to double by 2050. “
As more people go over the hill, the demand for lawn maintenance will increase as fewer homeowners can do the chores themselves and more are willing and able to pay for the service.