Global Electrical ED Industry Outlook

  • The global electrical ED market is forecasted to grow at a CAGR of 4– 5 percent to reach $268 billion by 2021, driven by the  increasing investment in commercial & industrial construction segments 
  • Majority of the firms in this industry operate within their national/regional market, due to:
     – Expertise in specialized electrical engineering and design services  
     – Myriad regional regulations  
  • A trend of mergers and alliances of various global engineering firms has been witnessed over the past decade to increase  foothold in various regions across the globe
     

 global-electrical-design-and-engineering-market-size

  • The industry is highly fragmented across all the regions, with the top 10 firms accounting for only ~5 percent of the market
  • Global industrial buyers generally prefer sub-contracting electrical engineering and design services to a large EPC/EPCM contractor as a turn-key/design-build project to eliminate risk and ease of implementation
  • The global electrical design & engineering industry is projected to grow at a CAGR of ~4–5 percent between 2018 and 2021 
  • The industry is valued at $223.6 billion in 2017, and it is expected to reach $268 billion in 2021. In 2017, the top 10 MEP firms earned $6.1 billion in MEP engineering design revenue, a 6 percent decrease over 2016
  • The demand for the electrical design services is driven by the new construction segment, namely healthcare/pharmaceutical, commercial,  green buildings, and industrial facilities 
  • APAC accounts for almost 55 percent share in the overall electrical ED market, followed by North America and Europe, with a share of 19  percent and 18 percent, respectively

Drivers and Constraints 

Drivers

  • Building refurbishment: During 2018–2021, there will be an increase in the refurbishment of commercial and mixed-use buildings. This will be a major driver for electrical design & engineering services globally 
  • Sustainable/green design: Sustainable design is of high demand in the market, currently leading to the rise of niche segments, like lighting, low consumption energy design, solar panel integrated roof, etc. 
  • Government regulation/initiatives: Governments across the world are emphasizing more production of renewable energy. This has led to an increase in the demand for electrical design in power and energy sectors

Constraints 

  • Recruiting and retaining staff: Skilled workers have left the industry, due to the economic downturn and high wages offered in other allied industries. In the developed countries, there is a huge shortage of skilled electrical contractors 
  • Technology adoption: Poor adoption of MEP BIM and 3D Laser Scanning by suppliers and buyers have led to delay in advantageous time and cost-estimation methods
  • New skills from electrical contractors: The increasing use of electrical smart devices and energy management systems required new skills from the electrical contracting professionals, as they are reluctant to change, due to insufficient training