Connector Industry Forecast 2025

The 2025 "Connector Industry Forecast" update report provides an in-depth, and detailed forecast of the worldwide connector industry. In addition to the detailed forecasts for each region of the world (North America, Europe, Japan, China, Asia Pacific, and ROW), an industry overview is included which provides current market trends, currency fluctuation effects, and industry sales performance, as well as an outlook narrative.

Worldwide and each regional forecast includes:

2025- A Year That Could be Shaped by Economic & Political Uncertainty

Coming out of a negative year is always difficult and 2024 was no exception. A year that started with weak year-over-year and year-to-date billings, 2024 ended up being a pleasant but well-earned surprise for the connector industry. Year-over-year, the connector industry grew +5.6%, with all market sectors and product types showing growth. Not all regions though, performed as well as others, with several regions showing negative year-over-year growth. But the regions that grew, Asia Pacific, China, and North America more than compensated for their decline. Among events that highlighted the year was the completion of a presidential election in the U.S., the rise of populism and far-right parties in several European countries and continued potential instability in the Taiwan Strait, as well as several natural disasters worldwide.

Unlike previous years, where most of these developments were reflected in the bookings, in 2024, year-over-year bookings remained strong and positive for all but one month of the year. The greatest year-over-year growth was seen in October, when bookings grew +13.4%, followed by June with bookings growth of +11.3%. From a year-to-date standpoint, bookings were strong in all 12 months, and we ended the year with over 12 weeks of backlog. 2025 is also shaping up to be a year of strong bookings, with double-digit year-over-year growth in March and April.

Industry Sales Performance by Region

In 2024, as seen by the table below, growth and decline were not equal across all regions, nor will they be in 2025. The Asia Pacific region saw the greatest growth in 2024, growing +19.2%. With growth of +12.1%, the Chinese region followed Asia Pacific. The only other region showing an increase was North America, where sales increased +6.8%. All other regions declined in 2024, with the greatest decline in the ROW region, where sales in US dollars decreased -15.7%, followed by Japan with a decline of -13.8%. Europe, the only other region declining, showed a decrease of -3.2%.

2023 and 2024 Connector Sales by Region
With Percent Change

Examining projected performance in 2025, you see Asia Pacific, who was ranked number two in 2024, is anticipated to move up to the number one spot in 2025.The Asia Pacific region will be followed by China, where sales are anticipated to increase. All other regions are projected to grow in the single digits.

In addition to connector sales results varying by region in 2024, electronic connector sales also varied remarkably by market sector. As the table below shows, in 2024, the computer & peripherals equipment/market sector saw the greatest percentage growth, at +10.7%. It is interesting to note that this was the first time since 2006 that the computer & peripherals market sector outperformed all other sectors!

2023 and 2024 Connector Sales by Market Sector
With Percent Change

2025 and Beyond Outlook

With industry backlog remaining strong, Bishop is forecasting 2025 sales. We anticipate the greatest percentage increase will occur in the Asia Pacific region, followed by the Chinese region where sales are anticipated to increase. When looking at growth in U.S. dollars, although not the greatest increase percentage wise, the largest increase in sales will be seen in the Chinese region, where connector sales will increase.

Forecast Assumptions

Forecasting is always difficult, especially during times of economic and geopolitical uncertainty. Projecting future business conditions in this environment is almost impossible. Consider the following economic headwinds, political challenges, and uncertainties.

• Instability in the worldwide economy. As indicated during the World Economic Forum in January 2025, "56% of leading chief economists expect weaker global economic conditions in 2025, compared to only 17% expecting improvement". Even in the U.S., where 44% of chief economists predicted strong growth in 2025, up from 15% when they were asked in August last year, there is concern. It was also noted that "short-term prospects for US growth were tempered by concerns over rising debt and inflation.
• No drop-in interest rates by the Federal Reserve. Voted on in mid-May 2025, and although highly encouraged by President Trump to rates alone is highly reflective of their desire to be seen as an independent institution that's main goal is to encourage and maintain stable prices and keep unemployment low and not be swayed by current leadership. It was indicated by Fed Chair Jerome Powell that they needed to wait for "greater clarity" regarding the impact of tariffs before making changes to monetary policy, especially considering the fact the U.S. economy looked quite sound prior to the implementation of tariffs. It is believed the Feds will review interest rates sometime early fall. decrease, the Federal Reserve voted to keep the federal funds interest rate between 4.25% and 4.50%. Many feel their decision to leave
• Like 2023, although global supply chain issues improved drastically in 2024, they still exist and could possibly get worse with the impact of potential tariffs and, as political tensions and economic instability increases. It is anticipated that freight availability, costs, schedule reliability and international trade agreements could easily change as we continue into 2025. In fact, there was a decline of over 50% in the number of ships that passed through the canal in 2024 versus 2023.
• A shortage of labor, in particular skilled laborers, such as electricians, plumbers, carpenters, machinists, welders, pipefitters, and steelworkers, even doctors, nurses, and pharmacists. A number of reasons are sited for this shortage including a decline in apprenticeship programs and shop classes, an increase in employees retiring, particularly Baby Boomers (generally classified by those born between 1946 and 1964) and not being replaced by younger workers, and a major shift in workers expectations, covering pay, hours, working location - onsite versus remote, work-life balance, and flexibility. Other factors include lack of accessible childcare, a diminishing population (lower birth rates in the U.S. and Europe), and growth in new business start-ups, led by an increase in digital commerce.
• Increasing and prolonged political tensions:
  • Now entering its third year, the war between Ukraine and Russia continues. With Russia currently occupying approximately 20% of Ukraine, it does not appear that even with negotiation assistance from other countries that an end is in sight. It was indicated by Global Conflict Tracker that "since January 2022, Ukraine has received about $407 billion in aid, including over $118 billion from the United States. Fighting and air strikes have inflicted over 40,000 civilian casualties, while 3.7 million people are internally displaced, and 6.9 million have fled Ukraine".
  • Israeli - Palestinian conflict over land and who controls it is one of the longest and most violent disputes ever. After it was announced on January 15, 2025, that the United States, Egypt, and Qatar had successfully mediated a cease-fire between Israel and Hamas to end fifteen months of fighting in Gaza, by late March, tensions grew, and the six-week cease-fire ended.
  • Worsening instability in Haiti, which discourages domestic and foreign investment, hindering economic development and resulting in negative GDP growth and a contraction of the economy.
• Lack of affordable housing worldwide. According to UN-Habitat, by 2030, an estimated three billion people, or about 40% of the world's population, will need access to adequate housing. This translates into a demand for 96,000 new affordable and accessible housing units every day. Unfortunately, as many countries have seen, adequate housing has become a major challenge, plagued with rising costs, limited availability, and ever-growing affordability issues, particularly in major cities.
• Climate change is also being touted as a potential headwind. According to S&P Global, "climate change has resulted in more frequent and severe weather events such as hurricanes, droughts, floods and wildfires, which have damaged infrastructure and disrupted supply chains, leading to resource scarcity and economic instability.
• Fluctuating commodity prices. Representing a wide range of assets, from oil and gas to precious and industrial metals, commodity price trends as indicated by US Bank, "tend to gauge the impact on inflation.
• Probably one of the most important headwinds that needs to be mentioned is tariffs imposed by the U.S. under President Trump. Intended to boost American manufacturing and protect jobs, President Trump has levied tariffs on imports, as the BBC has stated, throwing "the world economy into chaos" with many arguing that "they will make products more expensive for U.S. consumers". Although the U.S. and China have agreed to slash tariffs they have imposed on each other for 90 days, and the U.S. and U.K. have announced an agreement has been made, many are still concerned how this will affect the world economy. As previously pointed out by the U.S. Fed, "greater clarity" is needed before anyone can actual determine how these tariffs will affect the worldwide economy.

There are also some interesting projections as to why we will see connector growth in 2025 and beyond, and what that growth will be. These include factors such as strong bookings, historical growth, and low unemployment coupled with strong consumer spending.

This report details the markets where Bishop anticipates growth, and which subsectors will drive that growth. This report provides projections for the period 2025F through 2030F, with year-over-year percent change and five-year CAGR by region, market sector, and sub-sector. Will the industry continue to grow, and which years may not be as strong as others? These answers and more are revealed in the May 2025 "Connector Industry Forecast".