If you had to warn away some earnest youth from choosing a doomed career, which should it be?
Buggy-whip design? Ventriloquism? Tooth-Darkening?
A new — and abysmally depressing — report by the market research company IBISWorld names 10 U.S. industries, which, if not actually dead, are heading that way fast. Some, such as manufactured housing, theoretically could get better and enjoy a healthy future. Others, though, such as record stores, cannot: They might just as well strap on a "Do Not Resuscitate" sign and pull down the shades.
"While the U.S. economy is headed further into recovery, not every industry is performing well," writes the report's author, Toon Van Beeck. Every industry, he says, goes through its own lifecycle — growth, maturity and decline. IBIS combed its data base of some 700 industries and studied 200 that were in decline. From those it identified 10 that it considers "standouts."
All the following, says Van Beeck, are "on the verge of extinction:"
Dealers in manufactured housing
Wired telecommunications carriers
DVD, game & video rental stores
Providers of video postproduction services
The photofinishing industry
Renters of formal wear and costumes.
Any company or industry, of course, can suffer a temporary setback. The pizza and pasta chain Sbarro, for example, on Monday announced it would seek bankruptcy protection, owing to increased costs for cheese and flour, plus a recession-related falloff in customer traffic in the malls where it does business. After restructuring, Sbarro hopes to soldier on.
But companies in the 10 industries fingered by IBISWorld suffer from illnesses more intractable and lasting.
All 10 industries are in long-term decline. From 2000 to 2010, each experienced a sizeable contraction both of revenue and of its total number of establishments. Looking forward, further deterioration in both is forecast for each industry between now and 2016. Further, all 10 are being hammered by one or more of the following blows:
Damaging external competition: U.S. hosiery and sock mills, for example, have suffered withering competition from overseas mills that can produce the same quality of goods at lower cost. Mill revenue in general fell more than 50% between 2000 and 2010, with a further drop of 10% forecast over the next five years. External competition also is the reason the formal wear rental industry is on life-support: imports have grown. But another factor also is at work: As personal disposable incomes have risen in the past decade, consumers have found it more convenient to buy than rent.
Advancements in technology: As recently as 2000, Blockbuster was a thriving company. While demand for DVDs, games and videos remains strong, Blockbuster's gone bankrupt. It and other brick-and-mortar retailers have seen their business go to competitors using other means to deliver the same product. The same holds true for record stores, decimated by the internet. Record stores saw a revenue decline of more than 76 percent between 2000 and 2010. Their revenue should drop another 77.4 percent by 2016. In recent years both Virgin Entertainment Group and MTS Incorporated (Tower Records) have left the business.