Heat Hurts Profits

The brutal summer heat has cooled demand for many small landscaping businesses along the East Coast and several central U.S. states, adding distress to a sector already hurt by the recession. "Business has dropped substantially," said Tim McCarey, owner of McCarey Landscaping Inc. in Middletown, New York. He estimates revenues are down by about 30 percent from this time a year ago, and says he's had to reduce the number of workers he employs during summer to 38 from more than 50. "We've had to lay off people because the dryness affected us so much."

Last month, temperatures were above normal through much of the country, with some cities—such as Hartford, Connecticut, Providence, Rhode Island, and Washington DC breaking records, according to the National Climatic Data Center. Precipitation levels were also below normal in July throughout most of the Southeast and several states in the upper West Coast, the center says.

The mostly small businesses that serve these areas in the landscaping and lawn-care sector say the extreme heat has been killing grass and in some cases triggering the onset of weeds, insect invasions and diseases. As a result, consumers will likely need to wait for cooler weather before lawns can be revitalized through seeding and fertilization—services typically provided by lawn-care professionals.

Meanwhile, landscapers say the extreme heat is prompting many consumers to put off investing in planting, mulching, fencing and the installation of patios and walkways. Such services, which landscaping and related businesses provide, are more popular when yards are plush and green.

The economy also has been a factor. "People who would normally have us install decorative mulch or stone around their house are buying materials and doing it themselves to save," says Mr. McCarey. And other customers "are saying 'cut our services from weekly to biweekly,'" he adds.