The latest quarterly update to the five-year forecast for equipment rental industry revenues released by the American Rental Association (ARA) continues to call for steady gains through 2021.

Overall, ARA’s five-year projection in late July is virtually the same as it was at the end of April, with some minor variations in expected percentage growth each year. The new forecast projects U.S. equipment rental revenue to reach $49.3 billion in 2017, up 4.3% over last year.

The late July forecast also calls for U.S. rental revenue to grow 5% in 2018, 5.8% in 2019, 4.4% in 2020 and 3.9% in 2021 and to reach $59.4 billion combined for the three segments of the industry, including construction/industrial, general tool/light construction and party/special event.

The quarterly update also reflects the relatively steady projections for real gross domestic product (GDP) growth over the next few years in the U.S. of 2.3% in 2017, 2.7% in 2018 and 2.3% in 2019.

“What is interesting to note is that the U.S. equipment rental industry continues to post strong performance numbers that nearly double the growth of the economy and we expect this trend to continue for the foreseeable future,” said John McClelland, ARA’s vice president for government affairs and chief economist. “How Congress deals with tax reform and infrastructure spending also could add to the equipment rental industry’s momentum.”

Scott Hazelton, managing director, IHS Markit, said the data on the broad economy continues to be positive, resulting in very little change in the equipment rental revenue outlook.

“Job growth remains strong, GDP growth is solid, consumer confidence is high and housing continues to improve slowly, although construction spending has been flat. With recent evidence proceeding roughly as expected, we continue to call for growth rates near 4% for construction/industrial and general tool equipment rental revenues. Party and event is expected to do somewhat better, with nearly 7% growth,” Hazelton said. “However, there is considerably greater uncertainty regarding the outlook for 2018. We still expect tax reform and an infrastructure spending increase that will accelerate the economy next year. Such stimulus would push rental revenue growth toward 5%. Yet the lack of legislative consensus, even within the majority party in Washington, D.C., does give reason for concern that expected stimulus might not be forthcoming. We will be paying close attention to federal policy over the next few months, as forecast risk has moved significantly toward the down side next year.”