DEFINITION of 'Declining Industry'

An industry where growth is either negative or is not growing at the broader rate of economic growth. There are many reasons for a declining industry: consumer demand may be steadily evaporating, the depletion of a natural resource may be occurring, or there may be the emergent substitutes because of technological innovation.

Declining Industry

BREAKING DOWN 'Declining Industry'

An example of a declining industry is the railroad industry, which has experienced decreased demand - largely due to newer and faster means of transporting goods (primarily air transport and trucking) - and has failed to remain competitive in pricing, at least in relation to the benefits of faster and more efficient transport provided by airlines and trucking services.

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RELATED FAQS
  1. Why should I invest in the railroads sector?

    Reap the benefits of the railroad sector's advantages over its competitors by adding companies in this industry to your investment ... Read Answer >>
  2. How does the risk of investing in the industrial sector compare to the broader market?

    Discover how the risk of investing in the industrial sector compares to the broader market. The industrial sector is highly ... Read Answer >>
  3. What are the most popular mutual funds that give exposure to the railroads sector?

    Investing in sector-specific mutual funds, such as transportation funds that include railroad company stock, can be a smart ... Read Answer >>
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