ARA releases updated economic forecast

By |  March 14, 2024

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The American Rental Association (ARA) forecasts a fairly-positive outlook for the U.S. equipment rental industry’s growth.

Last quarter, the year-over-year growth was expected to be 7.6 percent in 2023 and 3.1 percent in 2024. The current projections indicate a 7.9 percent increase in 2024 totaling $77.3 billion in construction and general tool rental revenue.

“The ARA Rentalytics quarterly forecast reinforces the strength of the rental industry,” says Tom Doyle, vice president of program development at ARA. “Rental should benefit with tailwinds from interest rates, inflation, improving supply, a preference to rent and government and private spending. Rental revenue is again forecasted to increase.”

Looking at construction and industrial equipment (CIE) growth in the U.S., ARA projects $60.9 billion in revenue in 2024, which would be a 7.5 percent increase. The association anticipates three percent growth between 2025, 2026 and 2027. While the difference is smaller, ARA says it is still appreciable and more in line with a steadily growing economy.

“We see a slowing of growth this year compared to last year but, bear in mind, we have a slowing of inflation this year as well,” says Scott Hazelton, managing director at S&P Global. “The growth rates tail off in the future years, with growth of 4.3 percent in 2025 and 3.9 percent in 2026.”

Additional forecasts

The current forecast for total Canadian equipment rental revenue shows a 3.1 percent growth to $974 million in 2024, according to ARA. This year’s growth is anticipated to be stronger in Canada than 2023 growth due to inflation and resilient demand. In addition, Canada’s housing market and nonresidential construction are both improving.

While CIE investment will decline from previous years, ARA forecasts a 7.2 percent increase. The stark contrast from previous years is attributed to the lack of post-COVID investments in 2024, according to the association

As businesses choose rental over ownership, ARA anticipates the CIE rental penetration rate to follow. The 2023 estimate of 56.4 percent is near the pre-pandemic peak.

ARA’s outlook for general tool investment in the U.S. is not as positive as other areas. The association forecasts muted investment growth at 6.8 percent, with manufacturing driving growth and housing remaining a weak spot.

“ARA’s quarterly member survey showed conflicting results amongst members with just over half of respondents saying they saw a revenue increase in quarter four, a slight improvement over quarter three which saw an even split between those [expecting] an increase and [those expecting a] decrease,” says Mike Savely, director of program development at ARA.

In current forecasts, no state in the U.S. has a decline in rental revenue growth in the next five years. According to ARA, there are states with weaknesses, but there is still growth.

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About the Author:

Jack Kopanski is the Managing Editor of Pit & Quarry and Editor-in-Chief of Portable Plants. Kopanski can be reached at 216-706-3756 or

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