Current-Carrying Wiring Devices

SIC 3643

Companies in this industry

Industry report:

The industry is divided into six major categories: switches, wire connectors, convenience and power outlets, lamp holders, metal contacts, and other devices such as plug caps and connector bodies. Miscellaneous products encompass items such as trolley line materials, lightning protectors, and fluorescent starters.

Industry Snapshot

The current-carrying wiring device industry is closely tied to the cycles of the construction industry. Although value of shipments in this industry fell in the early 2000s--from $5.4 billion in 2000 to $4.9 billion in 2002--by 2007 the United States was shipping $7.2 billion worth of current-carrying wiring devices, according to the U.S. Census Bureau, thanks in part to the booming construction industry of the mid-2000s. Despite the economic recession that followed later in the decade, sales remained at approximately $7.3 billion in 2009, according to Dun & Bradstreet's figures. In addition, an increasing proportion of new construction projects were being outfitted for networking of various stripes in the early 2010s.

Background and Development

The basic technology for this industry was discovered in 1729, when Stephen Gray, an English physicist, found that some substances could carry electricity from one location to another. These substances were called conductors. In 1820, Danish physicist Hans Christian Oersted found that a metal wire carrying a current of electricity would cause a compass needle to change direction. Georg Simon Ohm is credited with developing the theory of electric circuits in 1825. Subsequent advances gave birth to manufactured current-carrying wiring devices.

Rapid development of residential, commercial, and institutional structures in the United States between 1945 and 1980 propelled industry revenues past $2.5 billion per year. Strong development during most of the 1980s resulted in average annual growth of about eight percent. By 1989, sales of current-carrying devices had surged to about $4.4 billion. Economic contraction in 1990 stalled industry growth, and stagnant construction markets repressed growth throughout the early 1990s, although an increase in housing starts and general economic improvement through the 1990s boosted shipments to about $5.4 billion in 1997.

To compensate for slow domestic sales, some industry participants capitalized on expanding export demand, which rose as a result of a weak U.S. dollar. Exports gained 14 percent in 1991, reaching a record $1.4 billion, or nearly 30 percent of total shipments, but growth of exports was flat through the mid-1990s. In combination with slow export growth, imports increased significantly in the mid-1990s, adding to the deficit trend that began in the early part of the decade. Major importers into the United States were Japan, Mexico, Taiwan, and Germany. Imports from Mexico grew in the mid- and late 1990s, particularly after the North American Free Trade Agreement (NAFTA) was initiated in 1994.

In the late 1990s, wiring device manufacturers benefited from steady residential construction markets and an upsurge in home renovations. In addition, new government building regulations mandated the use of certain wiring products. The National Electrical Code (NEC) that was implemented in 1993, for example, required the installation of special ground-fault circuit interrupters (GFCIs) that detect ground faults and shut off power to protected circuits. The revised 1996 NEC code augmented GFCI requirements. The sale of these and other devices bolstered industry growth.

The early 2000s were troubled times for wiring-device manufacturers. According to Plant Engineering, average production costs rose 3.3 percent in the year ending February 2003, while the prices manufacturers charged for their products rose less than one percent, resulting in lowered profit margins and pressure to raise prices and cut costs, measures that carried clear burdens for the industry.

The industry tagged along with the continued surge of home- and office-networking systems. The structured-wiring segment--which included switches and other wiring systems for data and voice networks, high-speed Internet connections, lighting and appliance controls, and automation and security applications--was among the brighter spots in the industry. Coming on the heels of the early 2000s downturn in the economy and its attendant slowing of construction projects, the news that about one in six of all new residential homes was expected to feature structured-wiring systems was a beacon of hope to manufacturers of wiring equipment.

Current Conditions

The industry struggled along with other U.S. manufacturers in the economic recession of the late 2000s. New construction, one of the largest markets for current-carrying wiring devices, had dropped drastically. Single-family housing starts alone declined from more than 1.7 million in 2005 to 445,000 in 2009. However, the increased demand for structured wiring in both new and existing homes and businesses provided hope for the future, and manufacturers readied themselves to capitalize on this market. In 2010, for instance, industry leader Leviton introduced its "Connected Home" line, which offered more than 1,000 residential structured wiring products.

Worldwide, Asia and Europe accounted for more than 50 percent of the current-carrying wiring devices industry in 2010, according to a report by Global Industry Analysts (GIA), and the global market was expected to reach $31.4 billion by 2015. GIA predicted that growth in the industry would be driven by a revival of the economy and the construction industry, particularly the residential sector; new high-tech products; the need to meet local building codes; and growing interest in environmentally friendly building products. The report also noted that "recovery in construction of high-rise buildings and resurgence in residential home upgrades and renovation will result in greater demand for high-end switches with sophisticated features."

Although the industry faced some competition from the new wireless systems, some experts, such as Melody Bakeeff of In Control Technologies, continued to recommend wired "future-proof" systems, elling Professional Builder in October 2009 that these were "the most reliable in relation to signal-response."

Industry Leaders

In the early 2010s, the industry was extremely fragmented, and most leading firms were diversified manufacturers of electrical and wiring equipment. Among the major specialists, market leader Leviton Manufacturing Co. Inc. of Melville, New York, employed 6,000 workers and had annual sales of $350 million in the early 2000s. The company, founded in 1906, manufactured more than 25,000 kinds of electrical and electronic components, more than any other firm in the industry. Leviton specialized in home networking supplies and was particularly strong in the residential structured-wiring market, a segment for which Leviton made a number of strategic acquisitions in the early 2000s. According to the company's web site, 90 percent of American homes contained an electrical wiring device made by Leviton.

Eaton Corp. of Cleveland, Ohio, employed 70,000 people and brought in $11.8 billion in revenues in 2009. The firm continued to acquire businesses throughout the 2000s. In 2010, electrical power management accounted for about half of sales. Hubbell Incorporated of Shelton, Connecticut, had two divisions in 2010--Electrical and Power--and made a large variety of electronic and electrical components. With 12,700 employees, the firm had 2009 sales of $2.35 billion. Other industry leaders included the diversified ABB Inc., based in Cary, North Carolina, and a subsidiary of Zurich-based ABB Ltd., and Houston-based Cooper Industries plc, which had 28,255 employees and 2009 sales of $5.0 billion. In 2010, technology giant HP purchased former industry leader 3Com Corp. of Santa Clara, California.

Workforce

According to the U.S. Census Bureau, 479 establishments manufactured current-carrying wire devices and employed 34,100 workers in 2007. About 67 percent of employees were production workers. The industry remained fragmented enough that more than 78 percent of all companies employed fewer than 100 workers.

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News and information about Current-Carrying Wiring Devices

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Cost/price analysis Jul-98 Mar-99 Apr-99 May-99 Jun-99 Jul-99 Average product price index (annual % chg.) 0.18 -0.74 -0.74 -0.72 -0.63 -0.53 Industry direct manufacturing costs (annual % chg.) -0.58 -2.66 -2.68 -2.63 -2.46 -2.15 Direct manufacturing costs per $100 of product $51.71 $51.12 $51.24
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...12/14 Current-carrying wiring device manufacturing 335931 12/81 Primary products 335931-P 12/81 Current-carrying wiring devices, nec 335931-A 06/14 Current-carrying switches for electrical circuitry (including vehicular switches...
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...335929-S Wiring device mfg 33593 Current-carrying wiring device mfg 335931 Primary products 335931-P Current-carrying wiring devices, nec 335931-A Current-carrying switches for 335931-5Z electrical circuitry (including vehicular switches...
Industries face low margins. (Forum).
Plant Engineering; May 1, 2003; 700+ words
...troubled industries, the current-carrying wiring devices (SIC 3644) industry...Equipment 3585 0.41 Current-Carrying Wiring Devices 3643 0.65 Noncurrent...Equipment 0.33 stable Current-Carrying Wiring Devices -0.10 rising Noncurrent...
Building up the price of materials. (Cost Trends).(Statistical Data Included)(Illustration)
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...Equipment 3585 -0.05 Current-Carrying Wiring Devices 3643 -0.90 Noncurrent...Equipment 0.20 stable Current-Carrying Wiring Devices -1.21 stable Noncurrent...Equipment C -3.54 Current-Carrying Wiring Devices F 0.76 Noncurrent...
Price/cost/demand roundup.(Illustration)
Plant Engineering; November 1, 2002; 700+ words
...Equipment 3585 0.41 Current-Carrying Wiring Devices 3643 -1.45 Noncurrent...Equipment 0.51 stable Current-Carrying Wiring Devices -1.03 stable Noncurrent...Heating Equipment D 0.08 Current-Carrying Wiring Devices D -5.52 Noncurrent...

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