Streamlining Information Transfer between Construction and Structural Engineering Edited by Shiau, J., Vimonsatit, V., Yazdani, S., and Singh, A. Copyright © 2018 ISEC Press ISBN: 978-0-9960437-7-9 CON-11-1 BUSINESS SURVIVAL RATE IN CONSTRUCTION INDUSTRY IN RELATION TO OTHER INDUSTRIES: A COMPARATIVE ANALYSIS IFTE CHOUDHURY Dept of Construction Science, Texas A&M University, College Station, USA Construction industry is one of the largest industrial sector in the United States that employs close to ten million people and makes a high contribution to the growth of the country’s economy. In spite of the huge impact that the industry has on the US economy, construction businesses have a hard time surviving in the market, with construction companies having the least survival rate among all the industries. Five- year survival rate of construction companies is one of the lowest compared to other industries. This study aims at providing evidence that the construction industry suffers the most as compared to the other industries in terms of business survival rate. A General Linear Model was used for statistical analysis. Results show a significant difference between the construction industry and other industries providing evidence that the construction industry businesses have the least survival rate. Keywords: Business failure, Business entry rate, Construction sector, General linear model, US economy. 1 INTRODUCTION Business survival rate is the proportion of companies in an industry remaining operational at the end of a period of time. It can be measured on a yearly basis by finding out the difference between yearly entry and failure rates of enterprises in an industry. Failure in business is considered to be a state of insolvency which is an event when a company is unable to meet its liabilities (Clusel and Lagarde 2011). Frederikslust (1978) defines failure of a business as an inability to meet its obligations. Rate of failures vary from industry to industry and also from business to business in the same industry. The failure of businesses has a significant impact on the country’s economy. Business failure in the construction industry, which historically accounts for about ten percent to the national gross domestic product and employs about ten million workers (Nunnally 2011), must have a significant impact on the economy of the nation. The purpose of this study was to make an analysis of companies surviving in construction sector, on a yearly basis, compared with other industrial sectors. Another objective was to find out whether there is a relationship between the rates of emergence of new companies and survival on a yearly basis in nine different sectors of industry in the United States. The sectors of industry chosen were (1) agriculture, forestry, and fishing (AGR); (2) construction (CON); (3) manufacturing (MAN); (4) mining (MIN); (5) transportation, communication and public utilities (TCU); (6) wholesale trade (WHO); (7) retail trade (RET); (8) finance, insurance, and real estate (FIRE); and (9) services (SRV).