The home improvement sector has been growing for quite some time, but 2020 was a record-breaking year from adding shrubs in front yard to installing solar panels.
According to Harvard University, almost $420 billion was spent on home improvement projects last year. And there are no signs there will be a decrease in spending in 2021.
One reason for the sudden growth of home improvement has to do with the lockdowns that were brought in due to the Covid-19 pandemic. As people were forced to stay indoors with their pedestal fans, many turned towards upgrading and remodeling their homes. That means there has been a rising consumer demand for materials and tools.
The growing demand for home improvement has affected tool manufacturers in two ways. Firstly, the high demand means manufacturers have needed to make more tools for the consumer market.
Secondly, the trade market has seen a decrease in growth due to many professional tradespeople being unable to work during the lockdowns. Therefore, tools for tradespeople have not been in as much demand, and homeowners have been unable to hire professionals quickly to complete home improvement projects that require expert assistance.
Generally, the demand for tools is up. Power tools alone are expected to rise by 2.4% in sales through 2024. Whether manufacturers can keep up with the demand is up for debate.
Depending on the location, some manufacturing facilities have not been able to operate at full capacity due to Covid-19 and the lockdowns. That has had a knock-on effect on tool production.
Though, many manufacturers have managed to keep going by finding solutions to their production problems. For instance, many are purchasing used alternatives for fabrication equipment rather than buying brand-new tools like press brakes, saws, shears, and ironworkers.
The other issue is the lack of materials. There’s a shortage of various kinds of materials, which was already happening before Covid-19 and has been exacerbated because of it. When those scarce materials are used in tool production, it means the productivity of tool manufacturing is decreased.
It also means consumers cannot get hold of all the materials they need to complete their home improvement projects. Furthermore, the lack of materials availability has meant supply prices are skyrocketing.
American-made materials are more in demand than ever because Covid-19 and other issues made it impossible to get hold of many foreign construction materials. But the American market alone cannot keep up with demand.
Without any imported goods from other countries, the American home improvement market that has been increasing could well take a nosedive, as could the output of tool manufacturers.
In the coming months and years, it isn’t only the uncertainty of tool manufacturing and foreign-materials availability that could affect the home improvement market. There is also the growing shortage of tradespeople.
Some sectors are seeing huge shortages of tradespeople. For instance, while 7,000 new electricians begin work every year, over 10,000 retire, making a shortfall of 3,000 each year. In turn, that means many home improvement projects could take much longer to complete.
There’s undoubtedly a growing demand for home improvements. But a shortage of materials and workers is affecting the availability of many products.
Many tool manufacturers simply cannot keep up with the current demand and many homeowners are having to wait longer to get the items and the tradespeople they need.
It is not only tool manufacturing and home improvement projects that have suffered from logistics issues and problems brought about by Covid-19. For instance, the world currently also has a major semiconductor chip shortage.
It will take time for such problems to be resolved, but eventually, they will be. And tool manufacturers will then be able to keep up with the growing customer demand within the home improvement sector.