The Flexible Packaging Association (FPA) has released its latest “State of the U.S. Flexible Packaging Industry Report,” offering a comprehensive look at one of the U.S. packaging market’s most dynamic and economically significant segments. This annual report is a key resource for converters, suppliers, investors, and analysts, providing insight into performance metrics, material usage, industry structure, and future challenges.
Comprehensive Industry Overview
The report examines several critical areas of the industry, including:
- Performance: Revenue, profitability, volume, and capital spending;
- Materials and processes: Printing trends and material usage forecasts;
- End-uses: Retail segment data and demand trends;
- Industry structure: Mergers, acquisitions, and market share;
- Trade: Import/export activity; and
- Vision and challenges: Labor, pricing, and political outlooks.
It focuses on the value-added portion of the market— companies that enhance flexible materials through multiple processes such as printing, laminating, and pouch-making. This segment alone was valued at $34.1 billion in 2024, excluding items like retail shopping bags, consumer storage bags, and trash bags.
Economic Impact: A $51.5 Billion Contributor
A recent FPA-commissioned study by John Dunham & Associates highlights the flexible packaging industry’s broader economic contribution. In 2025, the industry is expected to generate $51.5 billion in direct economic output, support approximately 98,400 direct jobs, and contribute $8.7 billion in labor income, including wages and benefits. More information, including additional indirect and induced economic impact, can be found in the November/December 2025 edition of FlexPack VOICE®.
Industry Performance: Matching the U.S. Economy
According to U.S. Census data compiled by FPA, the flexible packaging industry reached an estimated $42.6 billion in sales in 2024, up 2.9% from $41.4 billion in 2023. This growth nearly matches the U.S. GDP increase of 2.8% for the same period.
Despite ongoing global uncertainty, industry profitability rose to 12.8% in 2024, marking the second-highest level in FPA’s reporting history—just behind 2021’s 13% peak during the pandemic. Meanwhile, volume growth was more modest at 1.8%, signaling a stable but competitive landscape.
With a 10-year compound annual growth rate (CAGR) of 3.5%, the industry remains one of the steadiest growth sectors in the U.S. packaging market. Flexible packaging represents 20% of the $213.4 billion U.S. packaging industry, second only to corrugated paper.
Looking ahead, FPA members forecast 4.8% growth in 2025, which would bring the market to $44.6 billion—well above the 2.7% inflation rate recorded in June 2025. However, these projections were made prior to the full impact of new federal tariffs, the consequences of which remain uncertain. Please note that the difference in value compared to the previously noted John Dunham & Associates economic impact study is due to the methodology used to prepare the reports.
Market Structure and Consolidation Trends
The flexible packaging industry is made up of approximately 600 converters:
- Top 5 converters comprise 36% of total industry revenue;
- Top 10 accounts represent 45%; and
- Top 25 represent 54%.
Although merger and acquisition activity slowed in 2024, interest in consolidation remains. (The 34 domestic transactions in 2024 compared to a high of 62 in 2021.) Notably, 11 new companies entered the acquisition space in 2024, suggesting fresh investor interest despite elevated interest rates.
Survey results indicate a cooling of short-term M&A ambitions:
- 19% of respondents planned acquisitions in 2025 (down from 33% in 2024); and
- 54% expect to pursue deals within 3–5 years (down from 65%).
Materials and Processes
Converters continue to rely heavily on films and resins, which make up nearly 50% of material spend:
- Resins: 25.5%; and
- Films: 24.3%.
Within the film category, polyethylene (PE) is the most widely used material, with 96% of converters reporting its use. Polypropylene (PP) and polyester follow as other leading options.
In terms of processes, the majority of converters are focused on:
- Bag/pouch-making;
- Printing;
- Laminating; and
- Stand-up pouch production.
Over 65% of companies perform at least one of these functions. Additionally, specialty processes like coating, extrusion, and labeling help converters stand out in an increasingly competitive field.
On the printing side, flexographic printing continues to dominate, accounting for 76% of all shipments. While digital printing adoption continues to grow—21% of converters now have digital capabilities—its share of total output remains low, with digitally printed products comprising only about 1% of overall shipments.
Challenges: Labor, Pricing, and Political Uncertainty
When it comes to industry hurdles, labor availability is once again ranked as the top challenge for converters. For suppliers, the leading concern was growth and access to new materials.
- Pricing concerns showed divergence between the two groups:
- Converters ranked raw material pricing as their second-biggest issue; and
- Suppliers ranked pricing to customers as their second-most critical challenge.
Interestingly, customer pricing didn’t make the top 10 for converter challenges, indicating a difference in focus. Political uncertainty—absent from the top 10 last year—emerged as the third-largest challenge for both converters and suppliers, likely tied to evolving trade policies and regulatory concerns.
Data Integrity and Sources
FPA builds its annual report from a range of authoritative sources, including:
- The FPA Member and Non-Member Surveys;
- The Annual Integrated Economic Survey (AIES) from the U.S. Census Bureau;
- Data from the U.S. Department of Labor and the U.S. Department of Commerce; and
- Reports from industry analysts and investment banks.
This multisource approach enables FPA to cross-check figures and ensure a holistic view of industry size, structure, and growth drivers.
Final Outlook: Positioned for Continued Growth
Despite challenges such as labor shortages and evolving trade regulations, the U.S. flexible packaging industry continues to demonstrate resilience, profitability, and innovation. With an FPA-member projected 4.8% growth rate in 2025, the industry is weathering economic headwinds and outpacing inflation, while outperforming broader manufacturing segments.
As converters invest in new processes, materials, and technology, and as consumer demand for flexible, sustainable packaging solutions grows, this segment is well- positioned to remain a core driver of the U.S. packaging economy in the years ahead.
Dani Diehlmann is FPA vice president, communications.
