The most noteworthy statistic on this page relates to the number of jobs produced by all 500 companies on the 2023 list of the industry’s largest firms. The number is quite impressive: 1.47 million jobs. It is, however, approximately 490,000 jobs fewer than were completed by the group one year earlier in 2021, year two of the pandemic, when everyone in the country was apparently making repairs to or improving their homes. It will likely be several years before the 2021 job total produced by the TOP 500 will be surpassed. It stands as a milestone to the pandemic and as a monument to the large amount of money circulating in the economy at that time.
The second most noteworthy statistic on this page relates to the dollar volume of remodeling revenue recorded by the 2023 TOP 500: $19.93 billion. This is a sizeable increase over the prior year when the list of 500 firms tallied $16.8 billion. But then there’s the obvious question of how remodeling revenue grew strongly at a time while delivering thousands fewer jobs. The answer is that average job size grew year-over-year.
There is anecdotal evidence from QR’s quarterly U.S. Remodeler Index from last year (produced by John Burns Research & Consulting) where remodelers reported larger scopes of work. Jobs did get bigger in 2022. But the real story of how revenue grew while the number of jobs retracted is found in higher costs. There was increased competition for skilled labor. Contractors had no choice but to pay more for it. Then there were skyrocketing prices for building materials, which were difficult to get in a timely fashion, so contractors paid more for these as well.
Another key factor in the apparent paradox of rising revenues amid a decline in the number of jobs completed is the extra time it reportedly took remodelers to complete jobs. An eight-week bathroom project stretched to 12 weeks. A four-day siding job to six days. In the aggregate, the TOP 500 remodelers experienced a reduction in their throughput.
The 2023 TOP 500 produced a record amount of revenue but not a record number of jobs. Big firms got a lot bigger. But there was growth throughout the list. The No. 500 company this year, Buckminster Green, a design-build firm based in Philadelphia, reported $2.9 million on eight jobs. One year prior, the No. 500 firm, Boolia Construction of Newport, North Carolina, reported $2.5 million on 150 mostly insurance-related jobs.
There was also huge revenue growth at the top of the list. Fast-growing Leaf Home nearly took the top spot away from Belfor, the insurance restoration giant that has held the No. 1 spot for more than two decades. Both firms are now pushing $2 billion in remodeling revenues.
The impact of four years of rapid consolidation is also on display in a new-look top 20. In addition to several acquisitions made by Leaf Home, firms such as Renuity, Renovo, and Great Day Improvements sit atop more than a dozen large firms who were once part of this list independently. Fueled by the knowledge and cash invested by their private equity owners, these firms are now growing organically and spreading out nationally. Power Home Remodeling, West Shore Home, DaBella, and Erie Home remain companies to watch.
Taking a Breather
After three years of torrid growth, The TOP 500 remodelers are predicting more growth in 2023, but at a much slower rate. They are forecasting $20.6 billion in remodeling revenues this year, about $670 million higher than 2022. A deeper look sector-by-sector suggests some bearishness. Home improvement companies on the TOP 500 are forecasting a slight decline in revenue year-over-year. Design-build and kitchen and bath specialists are forecasting slight gains. The most bullish group are the diversified, jack-of-all-trades full-service remodelers, who see a gain of approximately $475 million. QR
Links to Full Coverage of the 2023 TOP 500
Remodeling Segment Analysis
- Full-Service: Slower, but Still Growing
- Home Improvement Pros: Back to Earth
- Design-Build: Building Trust
- Kitchen & Bath Remodeling: Market Moderation
- Insurance Restoration Contractors: Business Is Good