The recession did not appear to affect metal-testing service companies, which weathered the economic storm comparatively well, and are primed to see further growth as the country continues to emerge from the worst downturn since the Great Depression. 

In the past five years, these firms have seen unwavering demand for research and development and testing, mostly due to increased regulation of consumer products and a greater public demand for safety and accountability. A recent report from IBISWorld noted that revenue for the metal-testing services industry grew at an estimated annual rate of 2.8 percent in the five years leading up to 2013, and is now worth $930.6 million. In 2013, the sector is expected to grow another 7 percent. 

Much of the increase in testing was attributed to the Consumer Product Safety Improvement Act of 2008, which expanded the budget of the Consumer Product and Safety Commission and allowed it to more rigorously test products. Kevin Culbert, an industry analyst at IBISWorld, stated that the new rule mandates all companies must pass certification tests that prove products comply with safety rules. This has led to a major increase in demand for companies that can accurately and efficiently test products. This higher demand has also pushed up competition in the industry.

“Faced with more testing costs, companies are increasingly beginning to perform testing of their own in-house, bypassing companies in the Metal Testing Services industry,” Culbert said. “Furthermore, rising demand and high profit have caused more firms to enter the industry.”

In the past five years, the number of companies that perform such testing services has risen at an annual rate of 1.6 percent, and in 2013, 535 firms existed.

Most of the businesses in this space operate in a narrow corner of the industry, putting to use several laboratories as opposed to one large location, the report found. 

Looking forward, IBISWorld estimates that the industry will continue to expand as large corporations see higher profit returns, which may be directed to research and development. Also, as industrial production processes improve, testing will continue to become more efficient, making it more attractive to companies. 

According to the U.S. Food and Drug Administration, defective products can have serious consequences for the public. To keep damages caused by these defects to a minimum, the agency requires thorough testing of all products before they can get to market.