Many people are drawn to the restoration industry for its reputation as being recession-resistant. While it’s true that catastrophe work isn’t tied to the S&P 500, it’s still unpredictable, leaving some restorers closing out their year with significantly less work than expected. To reduce the dependency on catastrophe-driven revenue, more restorers are expanding into adjacent service verticals. Diversifying in this way not only helps restorers serve their clients more holistically and generate new leads, but it also brings greater stability and consistency to their annual cash flow.
In this three-part series, we’ll share how restorers can add new service offerings to their businesses in three different verticals: environmental, roofing, and carpet cleaning. In part one, we interviewed environmental remediation expert Kory Mitchell, who grew one of the largest environmental services companies in the country, to share the ins and outs of environmental work and what restorers looking to expand into this industry need to know.
What Are Environmental Services?
In restoration, environmental work refers to services that address hazardous materials found during demolition, renovation, or disaster recovery. These materials often can’t be removed or repaired through standard restoration processes, but must be properly identified, contained, and abated according to strict regulations.
For restorers, environmental services often come into play when dealing with:
- Asbestos abatement
- Lead paint removal
- Mold remediation following water damage
- Interior and structural demolition where hazardous materials are disturbed
- Soil and groundwater remediation after wildfires, floods, or other disasters
- Hazardous material testing and disposal
The Demand for Environmental Services
Environmental remediation continues to grow, with no signs of slowing down. According to Grand View Research, the U.S. environmental remediation market was valued at approximately $20.6 billion in 2023 and is projected to reach over $31.5 billion by 2030, growing at a compound annual growth rate of 6.4%. In addition to traditional services like asbestos, lead, and mold abatement, new areas such as PFAS chemical remediation are opening up additional opportunities as federal and state governments expand the list of regulated materials.
Kory Mitchell emphasized that one of the environmental industry’s greatest strengths is its non-discretionary nature. “If you’re disturbing a regulated material, it has to be abated whether you want to or not,” he said. This built-in demand has helped keep the industry stable through both strong and challenging economic times.
He also pointed out that the long-term opportunity in environmental services is often underestimated. Because only portions of a structure are typically abated at a time, such as a wall section after a flood, there is always more material left for future remediation. Even as projects are completed, the need for environmental work persists, helping sustain demand across the industry.
Diversifying into New Markets
In addition to steady demand, environmental services offer restoration companies the benefit of a more diversified customer base. Opportunities extend beyond typical residential and insurance-driven work, reaching into sectors like education, healthcare, oil and gas, and federal, state, and local government contracts.
Mitchell explained that this broad range of clients helped his business continue to grow during major economic disruptions, including the Great Recession and the COVID-19 pandemic. Serving a diverse set of industries provides a buffer against downturns in any one market and can help stabilize revenue when traditional restoration work becomes less predictable.
Competitive Advantage and Market Differentiation
Many commercial and government clients prefer working with partners who can handle a broader range of services, including hazardous material abatement, testing coordination, and clearance, in addition to traditional restoration.
Mitchell noted that restoration contractors often have a head start in entering environmental work, as they are familiar with working in damaged structures and typically have some of the necessary equipment, such as air filtration units. With the right certifications and training, adding environmental services can allow companies to expand their offerings and take on a greater share of the project scope. Being able to self-perform both restoration and environmental work not only helps speed up timelines and lower costs for clients but also positions companies to build stronger, longer-lasting relationships.
What to Know Before Getting Started
Licensing and Certifications
Environmental services are some of the most heavily regulated activities in construction and restoration. Every state has its own licensing requirements for asbestos, lead, and mold abatement, and contractors working across multiple states must meet the regulations for each individual jurisdiction.
Certifications typically involve completing a federally recognized training course (based on OSHA and EPA standards) and passing a state-specific exam. Workers must be certified individually, not just the company itself.
“You have to know both your federal regulations and your state regulations,” Mitchell explained. “And every state does it a little differently. Some states have reciprocity, but many don’t, so you have to be ready to manage that across your teams.”
Companies must also factor in ongoing training and recertifications to stay compliant as regulations evolve.
Insurance and Bonding Requirements
The insurance and compliance needs for environmental work extend well beyond what is standard in restoration. Contractors typically need to carry:
- Pollution liability insurance, covering hazardous material exposure and handling.
- Performance and payment bonds for public sector projects like schools, hospitals, and government facilities.
- Specialized workers’ compensation classifications for employees who are exposed to hazardous materials.
In addition to these insurance requirements, licensing can quickly become more complicated for companies operating across multiple states. Meeting the regulatory standards for each jurisdiction often requires additional certifications, logistical planning, and careful recordkeeping. Because of these requirements, many public or federal clients will not award contracts unless all insurance, licensing, and bonding standards are fully met.
Labor and Staffing Challenges
Staffing remains a significant challenge in both restoration and environmental work, largely because the jobs, while well-paid and consistently in demand, aren’t always seen as glamorous. Mitchell noted that the environmental sector faces a broad shortage of certified workers, a trend that mirrors what many restoration companies are already experiencing.
Companies moving into environmental services should be prepared to:
- Invest in workforce training and retention.
- Certify employees across multiple states if they plan to operate beyond their home market.
- Supplement crews with local labor agencies when needed, particularly for larger or out-of-state projects.
For contractors already working to maintain a strong team, adding environmental services will require even greater focus on recruiting, training, and retaining qualified workers.
Compliance and Administrative Burden
The administrative side of the environmental business is often much more demanding than what most restorers may be used to.
This includes:
- Meticulous documentation and recordkeeping for each project.
- Tracking certifications, insurance renewals, and compliance requirements.
- Preparing for regular audits from government agencies, especially when working on public or federally funded projects.
Companies also need to be familiar with regulations that separate testing from cleanup.
“You usually cannot perform the testing and the abatement yourself,” Mitchell explained. “Most states require third-party consultants to conduct the testing and clearance to avoid conflicts of interest.” This may be a change from restoration projects, where contractors are often overseeing most of the process.
Conclusion
Adding environmental services can be a great way for restoration companies to expand their offerings, tap into a growing market, and distinguish themselves from their competition. With steady demand, opportunities across multiple sectors, and a need for qualified contractors, environmental work offers a viable path to sustainable growth for those willing to get involved.
While challenges like licensing, insurance, staffing, and compliance require strategic thinking and planning, companies that take the time to prepare can set themselves apart and position their businesses for long-term success in a market where demand is expected to continue growing.
ATI in collaboration with Kory Mitchell
Kory Mitchell is a leading voice in the environmental and demolition industries. Starting in abatement as a teenager, he and his brother, along with several best-in-class environmental firms, grew EIS Holdings into the largest abatement firm in the US for multiple years running, according to ENR. After the successful sale of the company, Kory left the CEO role at EIS holdings in 2024 and became an active board member for large specialty contractors, and formed Iconic Founders Group, a boutique advisory working with owners looking to preserve their legacy by selling to the right buyer. Kory can be reached at [email protected].
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