Subcontractors Report Revenue Drop

The slowing Northwest Arkansas economy and worsening financial situation of many developers and contractors had a tremendous impact on many Northwest Arkansas sub-contractors during the past year.

A large number of sub-contractor executives opted to not disclose revenue figures for the Business Journal’s annual sub-contractor list (p. 35), which may speak to the impact of the area’s declining housing and commercial markets. But a majority of those who did release revenue and employee numbers revealed drops in both areas.

A few sub-contractors noted that their revenue numbers were also down due to pending liens on completed projects.

Electrical sub-contractors faired the best with an overall three percent increase in revenue from 2005-2006 moving from $94 million in 2005 to $96.9 million in 2006.

Mechanical sub-contractors experienced a 31 percent revenue drop during the past year as those companies reported a total of $58.3 million in revenue for 2006, down from $84.10 million in 2005.

Specialty sub-contractors were hit the hardest by the economic decline. Revenue figures from specialty executives that released data showed a dramatic, 72 percent decline in revenue from $27 million in 2005 to $10.25 million in 2006.