Metal, Fabricated Structural
SIC 3441
NAICS 332312
The structural metal industry manufactures iron and steel structures off-site, for use in buildings, bridges, transmission towers, and ships, among other applications. Although some industry firms are diversified, the bulk of the industry's output is produced from purchased metals.
For statistical purposes, fabricated structural metal products are divided into four major categories: structural metal for buildings, structural metal for bridges, other fabricated structural metal, and unspecified fabricated structural metal. Accounting for 55-65 percent of industry shipments, fabricated structural metal for buildings is by far the most important product, and the one most susceptible to downturns in the construction industry.
Fabricated structural metal faces increasing competition from other primary construction materials, such as concrete and composites. Moreover, because the industry does little research and development of its own, it is dependent on R&D in other industries for technological advances. Unfortunately, many related technological advances had an adverse effect on the industry, further decreasing the need for fabricated structural metal. Facing similar problems, the steel industry embarked on a number of ambitious research projects aimed at developing higher-quality steels that could compete more effectively. It was expected that successful development and marketing of these products would benefit the fabricated structural metal industry.
Some of the industry's products are carports, bridge sections, greenhouses, silos, utility buildings, and radio towers. In 2003, the U.S. segment of the industry as a whole, including a small segment devoted to metal plate work, generated in excess of US$29.85 billion in revenue and employed nearly 162,000 people. According to Valuation Resources, less than five percent of the industry is due to exports or imports. Analysts predict volume growth of about 2 percent per year through 2010, with annual price increases of 2-3 percent.
At first glance, the fabricated structural metal industry in the 1990s resembled an offshoot of the steel industry. And in some cases, it was. Many integrated and nonintegrated steel companies, such as fast-growing Nucor Corporation of Charleston, North Carolina, had sizable fabricated structural metal operations. Construction companies, bridge manufacturers, and heavy industry companies, were also sometimes shareholders or owners of metal fabricating companies. Nevertheless, fabricated structural metal was a distinct industry. Fabricated structural metal companies did not manufacture metal; they constructed structural metal forms from a diverse array of finished metal products such as sheets, bars, and tubes. These products included barge sections, boat sections, expansion joints, floor jacks, floor posts, dam gates, highway bridge sections, radio and television tower sections, and fabricated structural steel. In turn, fabricated structural metal products were assembled to form building frameworks, ships, bridges, transmission towers, and oilrigs.
Like the steel industry, the fabricated structural metal industry represented one of the cornerstones of the industrial era. Massive pieces of iron and steel were hammered, welded, and cut into structural shapes for use in the construction of buildings, bridges, and ships. Workers, clad in safety gear and helmets, forced the metal into the desired forms amid a shower of sparks and metal particles. Huge cranes and forklifts loaded the finished products onto trucks and railcars for delivery. Accidents were frequent and employee turnover was high. Largely bypassed by the technological revolution of the past few decades, the fabricated structural metal industry, like many other traditional industries, was eclipsed by the newer, cleaner, technology-intensive industries of the late twentieth century. Most major steel makers also own some fabricated product facilities, while smaller manufacturers in this section buy from the producer and transform the product through a discrete operation.
The fabricated structural metal industry depends heavily on the construction industry. Commercial and industrial buildings absorbed up to 65 percent of shipments, making the industry highly susceptible to recessions and accompanying declines in new construction. Other important construction markets for fabricated structural metals were public buildings, churches, hospitals, oil drilling rigs, and high-rise apartment buildings. In the United States, federal funding of highway projects was expected to support demand for structural steel, used in bridge and tunnel reconstruction and roadwork, through the mid-2000s. With most major infrastructure already in place in developed nations, there was little room for growth in fabricated metal output. Output remained relatively flat through the 1980s and early 1990s, despite the mid-1980s boom in construction of office buildings and apartment buildings. Capacity utilization rates wavered between 80 and 85 percent, despite efforts at downsizing and capacity reduction.
With most of their output going to the construction industry, fabricated structural metal manufacturers, in effect, served as contractors on construction projects. As a result, the industry was highly dispersed and international trade, in fabricated structural metal products, was relatively low in comparison with other industries. U.S. exports in 2000 reached about US$750 million, with imports valued at only US$475 million. The size and weight of some structural metal, make it an unwieldy and unprofitable export over long distances, particularly when it competes with lower-cost local production.
A major factor in productivity growth has been the use of computer technology in the production process. Computer-assisted design and manufacturing eliminates manual drafting in the design process, thereby reducing labor costs, and resulting in higher product quality and less product rework. In addition, computer numerical control (CNC) machine tools reduce labor requirements, at the same time as they increase the need for skilled labor, while new microprocessor controls, like automatic welding, have enhanced productivity. The use of electronic data interchange (EDI) between producers and customers has increased industry demand for workers with great levels of computer and numerical literacy.
Small establishments (fewer than 20 workers) accounted for more than 90 percent of the fabricated structural metal industry's total plants—although in most countries, they produced only 10-20 percent of total shipments. In the United States, the top 75 companies (out of 677) recorded more than two-thirds of all sales and employed more than half the workforce. In countries such as Japan and South Korea, where giant industrial groups, such as Nippon Steel, Mitsui, Mitsubishi Corp., Sumitomo, and Pohang Iron and Steel Co. Ltd. (POSCO) dominated all areas of private industry, the discrepancy was even greater. Massive industrial conglomerates were also the norm in Europe. In Canada, establishments with fewer than 20 employees represented about two-thirds of all establishments, yet produced only about 15 percent of shipments. Establishments with more than 200 employees made up only 2 percent of the total, but accounted for 20 percent of shipments.
Fabricated structural metal is a key element of modern industrial civilization. Hidden in the shadow of the mammoth world steel industry, the fabricated structural metal industry plays a central role in modern architecture and shipbuilding. The skyscrapers that house twentieth-century businesses and workers were erected around a framework of fabricated structural metal. The huge suspension bridges that soar across rivers and inland seas are assembled from fabricated structural metal components. And the ships, oil tankers, and...
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