Industry Insight Report: Electrical Contractors Q2-2025
Industry Insight Report: Electrical Contractors Q2-2025
The electrical contracting industry continues to see strong momentum in Q2 2025, driven by both long-term growth fundamentals and a wave of operational innovation. As the construction sector remains active, especially in commercial real estate, contractors are turning to AI and automation tools to meet demand and streamline operations.
Key Trends This Quarter
1. AI Adoption Gains Ground AI-enabled tools are rapidly reshaping how electrical contractors manage customer service, scheduling, and job prioritization. Tools like Netic are being deployed by private equity-backed rollups and large independents alike to automate call handling, predict maintenance needs, and increase technician efficiency. This is particularly relevant as the industry remains fragmented and ripe for consolidation, a trend we’ve seen play out in Texas and beyond with increased buyer interest in platform-ready firms.
2. Strong Employment and Wage Growth The industry added 2.9% more jobs year-over-year as of April, with a remarkable 10.6% employment increase over the past three years, well above the private sector average. Average hourly wages reached $39.35 in April, up 5% from last year, with 20.3% growth over the past three years. These numbers underscore continued pressure on labor costs but also reflect healthy demand and scalability for well-run firms.
3. Forecast: Outpacing the Economy The outlook remains positive: the U.S. electrical contractor sector is projected to grow at a 5.07% CAGR from 2025 to 2029, outpacing the broader economy. Texas continues to be a standout market, benefiting from population growth, infrastructure investment, and a robust commercial building pipeline.
Outlook for Q3 and Beyond
We expect deal activity to remain strong throughout the summer, particularly for firms with recurring revenue, management infrastructure, and solid margins. Strategic buyers and private equity groups are still active, especially for businesses with growth runway and systems that support scale. Owners thinking about selling should ensure their financials are clean, systems are documented, and teams are stable to maximize value.
Lion Business Advisors’ quarterly industry insights incorporate data and trends sourced from internal deal flow and buyer activity, Vertical IQ, and market comparables from platforms such as Axial and BVR (Business Valuation Resources).
Industry Insight Report: Electrical Contractors Q2-2025
The electrical contracting industry continues to see strong momentum in Q2 2025, driven by both long-term growth fundamentals and a wave of operational innovation. As the construction sector remains active, especially in commercial real estate, contractors are turning to AI and automation tools to meet demand and streamline operations.
Key Trends This Quarter
1. AI Adoption Gains Ground
AI-enabled tools are rapidly reshaping how electrical contractors manage customer service, scheduling, and job prioritization. Tools like Netic are being deployed by private equity-backed rollups and large independents alike to automate call handling, predict maintenance needs, and increase technician efficiency. This is particularly relevant as the industry remains fragmented and ripe for consolidation, a trend we’ve seen play out in Texas and beyond with increased buyer interest in platform-ready firms.
2. Strong Employment and Wage Growth
The industry added 2.9% more jobs year-over-year as of April, with a remarkable 10.6% employment increase over the past three years, well above the private sector average. Average hourly wages reached $39.35 in April, up 5% from last year, with 20.3% growth over the past three years. These numbers underscore continued pressure on labor costs but also reflect healthy demand and scalability for well-run firms.
3. Forecast: Outpacing the Economy
The outlook remains positive: the U.S. electrical contractor sector is projected to grow at a 5.07% CAGR from 2025 to 2029, outpacing the broader economy. Texas continues to be a standout market, benefiting from population growth, infrastructure investment, and a robust commercial building pipeline.
Outlook for Q3 and Beyond
We expect deal activity to remain strong throughout the summer, particularly for firms with recurring revenue, management infrastructure, and solid margins. Strategic buyers and private equity groups are still active, especially for businesses with growth runway and systems that support scale. Owners thinking about selling should ensure their financials are clean, systems are documented, and teams are stable to maximize value.
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