The first two decades of this century have seen dramatic changes in industries around the globe.
The rise of the internet, microelectronics and the expansion of green technology has resulted in a death knell for some industries, while others have expanded at an exponential rate. Therefore, as we approach 2020 and beyond, it's pertinent to look to the future and understand where the next significant growth sectors are going to be.
What Are the Fastest Growing Industries?
Utilising analysis and statistics from an array of respected experts, we've compiled a list of the fastest-growing industries of the next decade, regardless of where you are on the globe.
The world of transportation has already been shaken up by the long-awaited arrival of hybrid and electric vehicles, but more changes are in store for an industry that has transformed the world in the last one hundred years.
The arrival of autonomous vehicles – pioneered by tech giants such as Google and Tesla – will signal a significant shift in the industry, with traditional automotive companies such as Ford, Hyundai and Toyota all betting big on its success. Although returns have been minimal so far, there is still much confidence in these investments, with a 2017 study by Intel predicting that the driverless car market will be worth $800bn in 2035 – and $7 trillion by 2050.
As these figures show, there is ground to be made up, but as the technology behind self-driving cars evolves, and regulations against them relax, the next decade could prove a fertile breeding ground for forward-thinking investors and entrepreneurs.
An industry that many analysts consider recession-resistant, construction should continue to be on the list of the fastest-growing industries of the next ten years.
The construction of affordable and safe residential housing is expected to spur the continued expansion of the industry, with McKinsey & Co. predicting that, by 2025, one-third of all people living in urban areas worldwide will need new living accommodations built. This alone means that the construction industry should continue to grow throughout the 2020s.
Interestingly, a recent study by financial data firm Sagewell also indicates that five out of ten of the fastest-growing small business industries are related to construction. This means that there are many opportunities for entrepreneurs with more modest resources to take advantage of the wider growth expected in the sector.
3. Real Estate
An industry that is linked directly to the growth of the construction industry, real estate is another key predicted growth sector.
Of course, real estate has seen more troughs than peaks in recent years, with the collapse of the United States housing market causing a global recession as recently as 2008. However, that same housing market has since recovered well, with home prices at an all-time high. Analysts predict that the housing market will continue to make up for the ground it lost a decade ago over the course of the coming years and remain one of the world's biggest growth industries.
The media landscape has undergone a drastic change over the last decade, with consumer viewing habits evolving at a lightning pace. Indeed, the rise of streaming services has upended the media delivery channels that consumers depended on ten years ago, with traditional television networks and film studios squaring off against new and more versatile competitors such as Netflix - who have almost single-handedly revolutionised the content landscape - and Amazon.
Videogames and virtual reality (VR) are also establishing themselves as serious entertainment players, as well. VR, which is still in its early stages as far as consumers go, should experience massive growth over the next ten years as devices become more accessible; the VR sector grew from $6bn in 2016 to $14bn in 2017 – and is predicted to continue morphing into a $160bn industry as soon as 2023.
5. Renewable Energy
Another area of technology that has been showing immense growth potential for some time, renewable energy is predicted to be a part of a period of rapid growth for the entire energy industry in the coming decade. This growth is being driven by several factors, too, such as a decrease in component production costs, and global government-driven initiatives to reduce dependence on fossil fuels.
It's not just state actors driving these changes, either. Electronics giant Samsung has pledged to use only renewable energy in all of its facilities beginning in 2020 and has installed over 40,000 square meters of solar panels across South Korea to accomplish this.
The rise of Amazon, Alibaba and other eCommerce giants have completely changed how consumers learn about and receive the items they purchase, with traditional high street players regularly being urged to build their online presence or disappear into obscurity.
While bricks and mortar retail still has some life left in it yet, eCommerce is expected to account for 20% of all retail sales by the end of the next decade; therefore, this suggests that despite the media hype, the most successful retailers will be business owners who can incorporate online sales into their key operations rather than replace one over the other. Further advances in virtual shopping personalisation services will combine the best of both worlds and should help the industry grow from $1.5 trillion now to $2 trillion by 2026.
The healthcare industry has grown by 12% in the last two years to become a $4 trillion industry, accounting for a little over 5% of the economic output of the entire world. It's not a stretch, then, to suggest that wellness is a market with huge potential.
While traditional healthcare facilities are showing signs of decreased profitability, the same advances that will allow for greater personalisation of retail shopping are also expected to have an impact on wellness care. Artificial intelligence and cloud-based patient data storage will provide customised care for individual patients, with other technological advances in patient care expected to drive growth rapidly over the next decade. As an indicator, the healthcare industry in the United States alone is expected to grow to over four million jobs by 2026.
As disruptors such as Airbnb and VRBO shake up the traditional order of things, the hospitality industry is undergoing significant transformation. For example, Airbnb alone has more than six million listings around the world, which, to provide some context, is more than the largest five hotel groups in the world combined.
While this rapid growth is undoubtedly a game-changer, traditional hospitality ventures are expected to gain some of that ground back; cities around the world are enacting stricter rules to level the playing field, while many large hotel chains are reinventing themselves through corporate and personal events. As travel becomes ever more accessible to a broader number of people, though, demand for rooms and restaurants is only going to grow, with plenty of market share available for businesses of all sizes.
Technology is something of a be-all term; after all, most of the industries in this list have transformed directly as a result of tech. Therefore, it's difficult to label technology as its own sector, even as it drives so much of the change in our world.
That said, innovations in areas such as cybersecurity and artificial intelligence will create massive markets and revenue sources for tech companies. Cybersecurity alone is predicted to be a $165bn industry by 2023, as businesses wake up to the reality of the threats posed online.
By its very nature, tech is an innovation-driven industry, too; as we continuously push the limits of what is possible, nobody can predict what the next great shift or advance will be, making it the ideal playground for business owners and entrepreneurs who are looking to change the world.
What other industries do you expect to grow in the 2020s? Let us know in the comments below.