The UK has one of the world’s biggest consultancy sectors, estimated to be worth about £10.6bn. The Annual Industry Report 2019, published by the Management Consultancies Association (MCA), has some useful insights for consultants and consultancies.
Increase in demand
With members of parliament not coming to a consensus about Theresa May’s deal, Brexit has become a protracted endeavour. It has resulted in economic uncertainty among businesses and government departments. Many organisations and institutions are hiring consultants to help plan for different scenarios, as the October deadline for the UK to leave the European Union draws closer.
The report found that almost 80% of the income of consultancies is generated from the UK, with the remaining 20% coming from overseas clients, half of which is from clients based in the European Union. The figures show that, while consulting is highly-sought in the UK, the demand for UK consultants overseas is high. So, the UK Government should focus on ensuring trade deals not just with the EU, but also with other countries.
Since 2016, the demand for consultants has increased in sectors such as infrastructure, retail and leisure, and digital and technology. However, sectors such as private health and life sciences, not-for-profit, and manufacturing have seen a decline in consulting.
The report also found that the demand for consultants in service line distribution has remained the same since 2016, and the high fee income-generating domain is digital and technology consulting. From 2016 to 2018, programme and project management has increased from 8% to 15%, but financial and strategy consulting have both decreased, from 10% to 4% and 8% to 6% respectively, in the last two years.
Public sector consulting
A recent MCA survey found that consultants are considered important for the public sector, as they are seen as a way to help it improve efficiency and bring transformation and innovation. Consultants are seen as professionals who can provide the best solutions to the sector. It may come as a surprise to learn that 22% of the fees generated in 2018 by consultancies have come from the public sector.