561492 Stenographic Services Industry Report

Industry Definition Main Activities Similar Industries Additional Resources About this Industry For additional information on this industry United States Court Reporters Association The

IBISWorld Industry Report OD5843

Stenographic Services in the US

threaten demand for courtroom stenographers

2 About this Industry

17 Market Share Concentration

17 Key Success Factors

17 Cost Structure Benchmarks

26 Jargon & Glossary

This report was provided to

Seattle Pacific University (2134529962)

by IBISWorld on 31 December 2019 in accordance with their license agreement with IBISWorld

This industry provides verbatim reporting and stenotype reporting of live legal proceedings and then transcribes

subsequent recorded materials Noncourt stenography services for depositions and related proceedings are included

The primary activities of this industry are

Stenotype recording Voice writing Taking depositions Closed captioning

54111 Law Firms in the US

Establishments in this industry provide expertise on a range of areas or specific areas of law, such as criminal, corporate, family and estate, patent, real estate or tax.

54193 Translation Services in the US

Establishments in this industry translate written material, interpret speech from one language to another and provide sign language services.

56141 Document Preparation Services in the US

Establishments in this industry provide letter or resume writing; document editing or proofreading; typing, word processing or desktop publishing; transcription and other secretarial services.

56143 Business Service Centers in the US

Establishments in this industry provide photocopying, duplicating and other document copying services.

Industry Definition

Main Activities

Similar Industries

Additional Resources

About this Industry

For additional information on this industry

United States Court Reporters Association

The major products and services in this industry are

Additional services Local government stenographic services State government stenographic services Other stenographic services

% change

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25

11 13 15 17 19 21 23

Year Revenue Employment

Revenue vs employment growth

Products and services segmentation (2019)

35.3%

State government stenographic services

32.2%

27.0%

Local government stenographic services

Key External Drivers Government consumption

and investment

Demand for stenographic services is heavily dependent on government expenditure, as stenographers are hired and paid for by local, state and federal courts As government expenditure decreases, courthouses have to reduce spending to balance their budgets In light

of budget cuts, courts have increasingly

sought cost-saving methods, moving away from in-person stenographers toward digital recording systems, thus hampering industry demand Government

consumption and investment is expected

to rise moderately in 2019

Demand from law firms

Demand for stenographic services is heavily dependent on legal activity Legal

Executive Summary Stenographers have played an important

role in the courtroom process for centuries Stenographers attend legal proceedings and other public speaking events and create transcriptions Over the five years to 2019, demand for the

Stenographic Services industry has been mixed as courts have increasingly cut back expenses amid massive budget cuts

More courts have outfitted their courtrooms with digital recording systems, removing the need for in-person stenographers However, despite

mounting external competition, an uptick

in legal activity over the past five years is expected to support a moderate

expansion for the industry As a result, IBISWorld only forecasts industry revenue to rise at an annualized rate of 2.7% to $2.7 billion over the five years to

2019 This includes an expected 1.5%

boost in 2019

The industry is highly competitive and fragmented, exhibiting low market share concentration The industry relies heavily

on labor for industry services and therefore does not benefit from economies of scale The industry’s low barriers to entry limit consolidation, and

online platforms that enable workers to act as nonemployers and easily reach contacts have further solidified such trends Larger companies have nonetheless lowered their dependency on labor through stenographic machines and related technology, leading industry wages to fall slightly as a share of revenue Falling relative labor costs have enabled a minor expansion in industry profit during the current period, with the average margin, measured as earnings before interest and taxes, reaching 12.2%

of revenue in 2019

Over the five years to 2024, the industry will continue to endure challenges amid heightened competition and rapid technological change As federal and state courts struggle to balance their budgets in light of budget cuts, these markets will increasingly seek new cost-saving measurements More courts are consequently expected to move away from in-person stenographers toward digital recording systems, thus reducing demand for stenographers in the courtroom Demand from other opportunities outside of the courtroom, including providing closed captioning for

TV programs and aiding students with hearing impairments, is expected to likewise decrease during the period Overall, IBISWorld estimates that industry revenue will rise a sluggish annualized 0.7% over the five years to

2024 to total $2.8 billion

Industry Performance

Industry Outlook | Life Cycle Stage

More courts have outfitted their courtrooms

with digital recording systems, removing the

need for in-person stenographers

Key External Drivers

continued activity can include lawsuits, criminal cases, intellectual property cases and civil

cases Increased legal activity helps boost industry demand, as more courts require stenographers to record proceedings In addition, stenographers can take depositions for law firms Demand from legal services is expected to increase in

2019, representing a potential opportunity for the industry

Private investment in computers and software

Voice captioning technology has improved and limited demand for

stenographic services in recent years Demand for industry services wanes as investment improves such software Private investment in computers and software is anticipated to rise in 2019

Crime rate

An increase in the rate of reported crimes leads to higher demand for legal advice, increasing industry revenue as a result Throughout the past 20 years, the crime rate has declined, mainly because of the aging population The crime rate is expected to continue to decline in 2019, posing a potential threat to the industry

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environment over the five years to 2019

Demand for in-person stenographic services is largely dependent on government expenditure and legal activity, as stenographers are hired and paid by local, state and federal courts

Stenographers attend legal proceedings and other public speaking events and create transcriptions, as well as provide closed captioning for individuals with hearing imparities

Over the five years to 2019, industry demand has improved overall amid an uptick in legal activity and recovering state budgets However, demand conditions have been mixed as courts trimmed expenses by outfitting courtrooms with digital recording devices

to replace the need for stenographers, reducing demand for in-person stenographic services in the courtroom

Rising competition from these digital recording systems has hampered more

robust industry growth However, despite challenging conditions over the past five years, an increasing level of legal activity has precipitated an expansion in demand for industry services As a result, over the five years to 2019, IBISWorld forecasts industry revenue to rise at an annualized rate of 2.7% to $2.7 billion, including a 1.5% boost in 2019

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continued to make big waves within the Stenographic Services industry

Stenographers typically use stenograph machines, which have existed, mostly unchanged, since 1913 Technological advancements have equipped modern stenograph machines with memory cards that are capable of holding a full day’s work These new technological developments help improve the quality and efficiency of a stenographer’s work and yield more accurate results

Nevertheless, over the past five years, industry operators have struggled to remain afloat as more courts have moved away from in-person stenographers toward digital recording systems Due to severe budget cuts, courts are seeking ways to implement cost-saving techniques Underfunded courts are

increasingly looking into using audio and video recording in place of a court reporter for hearings According to the

US Bureau of Labor Statistics, a salaried stenographer can cost the court more than $100,000 annually, with the median salary estimated at $55,120

Comparatively, the average cost of new mid-level audio and video equipment falls between $20,000 and $25,000 per courtroom, respectively

Although digital recording systems are considered to yield significant cost savings in the long run, high reliance on these technologies poses some potential risks One strain associated with these systems includes the difficulty to monitor discussions in the courtroom For example, stenographers can let attorneys know when they talk over each other or stop witnesses to answer questions before

Industry landscape The Stenographic Services industry

exhibits a relatively low level of market share concentration, with no singular operator accounting for above 5.0% of total revenue for the industry The industry is highly competitive and fragmented, primarily composed of small companies According to the US Census Bureau, more than 90.0% of industry operators employ fewer than 10 people

Due to the high level of accuracy required when recording court cases, delivering quality and efficiency becomes crucial for industry operators to stand out from competitors Stenographers are required

to receive a license and must be able to type at least 225 words per minute to transcribe legal proceedings Operators that successfully use voice-capture software and other web-based technologies to help improve accuracy and efficiency are able to gain a competitive advantage

Although the industry exhibits relatively low barriers to entry, primarily

in the form of minimal upfront capital requirements, the number of industry operators is expected to contract at an annualized rate of 0.6% to 4,494

independent businesses over the five years to 2019 Due to mounting competition and subdued demand for in-person stenographic services, industry operators have been consolidating or exiting the industry The remaining operators are leveraging technology to improve employee output and reduce wage costs Consequently, industry employment is expected to decline at an annualized rate of 0.3% during the same five-year period to reach 13,015 workers.Industry operator exits have reduced internal competition and enabled industry operators to charge higher prices for services that cannot be replaced by technological substitutes Accelerated by decreasing wage costs, the average industry profit margin, measured

as earnings before interest and taxes, is expected to improve marginally during the current period, reaching an estimated 12.2% of revenue in 2019

Industry operator exits have reduced internal competition

the attorney is finished talking, whereas audio recordings are unable to interact

Furthermore, glitches in digital systems may delay the workflow of courts and even increase operating costs For example, in Kentucky, where courts have used video recordings for more than 30

years, a judge in Jefferson County had to rehear a murder case due to the

malfunction of the court’s digital recording system However, stenographers can still be brought into a courtroom when an attorney requests one and pays for the service

Going digital

continued

Industry Performance

Alternative markets In addition to courts’ subdued demand for

stenographic services, stenographers will likely find reduced relief from outside markets Stenographers can provide real-time closed captioning for those with hearing imparities or take depositions for law firms or agencies Stenographers who work with deaf individuals and those with hearing imparities use communication access real-time translation (CART) to convert speech to text According to the National Association of the Deaf (NAD), CART services enable instant translation

of spoken words into text by using a stenotype machine, computer or real-time software on a local or remote basis

Stenographers accompany their clients to various events, physician’s appointments

or any other place where their services are needed While applications such as Google voice-enabled translators have limited capabilities, their use for informal translations has limited industry demand

Other stenographers are employed by high schools and college campuses and provide closed captioning of lectures to students with hearing imparities or those learning English as a second language Despite being a threat, new technological advancements can also enhance stenographers’ work, enabling them to work remotely over an internet

or phone connection

Under federal laws, broadcasting and cable companies and other satellite TV service providers must provide closed captioning for all new English-language programs, without exception In some locations, closed captioning is also required for televised emergency messages The Federal Communications Commission reinforces closed captioning rules In addition, associations such as the NAD are making efforts to provide millions

of hearing-impaired individuals with access to radio, one of the most popular forms of entertainment and

communication For example, National Public Radio (NPR) has tested real-time captioning streamed over the internet for some of its programs In addition to making these captions accessible through the internet, NPR tested the use of HD radio technology to display the captions on specialized receivers, which could be used anywhere These efforts are anticipated to facilitate demand for stenographic services over the next five years

Industry

Outlook

Over the five years to 2024, the Stenographic Services industry is anticipated to continue its expansionary trajectory, albeit at a decelerated pace

The trends that have affected demand for industry services over the previous five years are expected to continue to shape the industry during the five-year outlook period Federal and state courts will likely find new ways to save on costs, including replacing in-person stenographers with digital recording

systems that consequently decrease demand for stenographers in the courtroom Additionally, an anticipated acceleration in the decline of the crime rate from the previous five-year period will likely reduce the amount of legal activity, hindering demand for the industry’s courtroom services As a result

of these trends, IBISWorld forecasts industry revenue will grow at a slower rate, rising an estimated annualized 0.7%

to total $2.8 billion

Closed-captioning efforts are anticipated to facilitate demand for stenographic services

Industry landscape The Stenographic Services industry will

likely continue to remain highly competitive and fragmented Over the five years to 2024, the number of industry operators is projected to stagnate as companies continue to consolidate their operations or exit the industry Overall, this trend will lead industry enterprises to total 4,492 independent operators by 2024

However, despite increasingly competitive conditions, industry employment is forecast to rise slightly during the five-year outlook period, increasing at an annualized rate of 0.4% during the period to total 13,278 workers While significant outside competition from technology is expected to persist, an overall uptick in industry services provided will

necessitate a small increase in the industry’s workforce Meanwhile, the average industry profit margin, measured as earnings before interest and taxes, is anticipated to improve modestly over the five years to 2024 While demand conditions for the industry will remain mixed, consolidation of operations will enable

a rise in the average industry profit margin, which is expected to reach 12.3% of annual revenue by 2024

An uptick in industry services provided will necessitate a small increase

in the industry’s workforce

Industry Performance

Industry value added is contracting

The number of industry operators is declining

Substitute technologies are siphoning industry demand

Life Cycle Stage

Industry Life Cycle IBISWorld estimates that the

Stenographic Services industry is in the declining stage of its life cycle Over the

10 years to 2024, the industry’s value added (IVA), or its contribution to the overall economy, is expected to rise at a relatively sluggish annualized rate of 1.1% Comparatively, US GDP is projected

to rise at an annualized rate of 2.0%

during the same 10-year period Sluggish IVA growth amid an expanding national economy is highly indicative of a declining industry life cycle stage

Although there has been a wide acceptance and adoption of stenographic services, voice-caption technology has captured a growing share of the market Due to subdued demand for in-person stenographic services, many industry operators have been forced to consolidate their operations or exit the market Consequently, IBISWorld estimates that the number of industry operators will decline at an annualized rate of 0.3% over the next 10 years to 2024 to total 4,492 independent businesses

This industry is

in Decline

Products and Services

Stenographic services

Stenotype recording refers to the activity

in which a court reporter transcribes the court proceedings using a stenograph machine A stenograph machine is an electronic device, similar to a keyboard, with only 22 keys and a memory card that records the day’s typing Stenotype is the most popular way for a court reporter to record the events of a trial, as it enables the court reporter to easily read back what was said earlier in the trial if called upon

by an attorney or judge This segment’s share of revenue for the Stenographic Services industry has been declining over the past five years, however, as court reporters increasingly use advances in technology to aid in recording court cases

Other

Stenographers offer additional services such as making copies of transcripts Typically, the attorneys will pay for copies

of transcripts if they are required

Products & Markets

Major Markets | International Trade | Business Locations

KEY BUYING INDUSTRIES

54111 Law Firms in the US

Law firms will often purchase the transcript of the court case from the court stenographer.

92 Public Administration in the US

Local, state and federal courts use stenography services to record what is said during a court case.

KEY SELLING INDUSTRIES

32311 Printing in the US

Industry operators use printing services.

42342 Copier & Office Equipment Wholesaling in the US

Industry operators use copiers and other various office equipment, such as fax machines.

42343 Computer & Packaged Software Wholesaling in the US

Stenographers use computers and printers to transcribe court proceedings.

42411 Paper Wholesaling in the US

Stenographers use paper to print the transcribed court proceedings.

Major Markets State courts

State courts are the largest market for the Stenographic Services industry,

accounting for an estimated 37.4% of industry revenue in 2019 However, this

stenographers to switch between states’ courts The limitation imposed on state stenographers is also contributing to this segment’s declining share of revenue

Demand

Determinants Demand for the Stenographic Services industry is heavily dependent on

government expenditure and legal activity Stenographers are hired and paid for by local, state and federal courts,

as well as private law firms and other customers As government expenditure decreases, courthouses have to cut back

on expenses to meet budget constraints

Over the past five years, state and local courts have been increasingly making cut backs in expenses One of the ways these courts are cutting down is by outfitting courtrooms with digital recording devices

to replace the need for stenographers

The audio and video recordings are able

to record court proceedings more affordably than stenographers, lessening the demand for industry services

Conversely, increasing legal activity helps boost industry demand since more court cases require more stenographers

to record the proceedings Legal activity

can include criminal cases, lawsuits, intellectual property cases and civil cases Increasing legal activity translates to a higher number of court cases, boosting demand for stenographic services

Additionally, a rising crime rate will boost legal activity, as there will be more criminal trials Stenographers typically record criminal trials; therefore, as the crime rate rises, so will industry demand.Technological advances also play a major role in industry demand As technological advances make stenographers more efficient and accurate, this increased efficiency helps boost industry demand Over the past five years, voice silencers, the handheld electronic masks court reporters use to record court proceedings, have become increasingly advanced Voice silencers are now capable of providing real-time services in the same manner as stenograph machines, boosting the court reporter’s speed and accuracy when recording court cases

Products and Services

continued Additionally, the courtroom will keep a copy of a transcript for public record

Stenographers also provide real-time closed captioning services, which enables deaf individuals in the courtroom to be able

to read what is being discussed during the

proceedings in real time While stenographers usually write down what is happening during the trial, real-time closed captioning enables the stenographers to transfer their typing from the stenograph machine to a TV monitor in the courtroom

Products & Markets

International Trade As a service-based industry, the

Stenographic Services industry does not participate in international trade, with industry operations being largely

domestic However, as the industry is becoming more globalized, industry operators are increasingly offering their services in countries abroad

Major Markets

continued

slow to switch to digital recordings

Additionally, local courts are the most numerous out of local, state and federal courts Due to the high volume of local courts and the high salaries that local courts pay to stenographers, this segment’s share of revenue has nearly caught up to state courts within the past five years

as these cases tend to be high profile Digital recordings do not have a feature

to read back what was said in real time, therefore limiting technology

substitutions in this segment

Major market segmentation (2019)