The Autumn 2024 Sector Trends Tracker was completed between 23 September 2024 and 23 October 2024 by an impressive 95% of the 90 members of the tracker research panel of CEOs and C-Suite members at mainly mid-market UK professional services firms.
These are the key findings:
1. The Confidence index has continued to grow from 83% in the last tracker to 86%. The current index is made up of 88% of firms projecting expansion over the next 12 months and 2% contraction. Projected net expansion in new workflow has remained at 86% for three quarters. Headcount projections have also rebounded from net expansion of 50% at the last tracker to 60%, the latter made up of 65% of firms projecting expansion and 5% contraction. This net expansion compares with over 70% for most of 2023.
2. ‘People and the firm as an employer’ still carries most weight at partner/director discussions (58%), followed by ‘Finance & cash flow’ at 57%. ‘Operational performance’ has reverted to fourth place, similar to 2023. By contrast, ‘Operational efficiency’ continues as the top priority for management (61%), followed by commerciality (55%). As regards the constraints that are preventing firms from achieving optimal performance in the current economic climate, ‘Margin erosion’ and ‘Fee pressures’ remain at the top of the list, followed by ‘Poor economic outlook’ at 41%. ‘Political uncertainty’ has reduced from 29% to 18%, with ‘Regulatory pressures’ increasing from 25% to 30%.
3. ‘Communicating effectively’ and ‘Getting the best from the team’ (both at 63%) remain the management activities that are seen as contributing most to helping a firm achieve its goals. As regards the dominant management style at their firm, 70% chose ‘Challenge & support’ with only 5% selecting ‘Command & control’.
4. After the 11% fall in their firm being on track for success from the last Tracker (79% to 68%), the gap between firms and key clients remains 7% but with both increasing their scores – 68% to 74% for firms; 61% to 66% for clients. 24% of firms believe that remote working has increased productivity, with 19% saying that it has decreased productivity. This compares with over 50% of firms saying that it had increased productivity in the Autumn 2021 tracker.
5. 27% of firms reported that more than 20% of their services based on invoiced value are being delivered by UK-based partners/employees to internal or external clients based outside the UK, with a further 19% reporting a number between 11% and 20%.
6. 69% of firms are looking for about the same amount of office space over the next 12 months. 85% of employees are working between a quarter and half the time from home – both percentages are the same as the last tracker.
7. Verbatim messages to Government can be found on the last pages of the infographic. These have already been shared with Government.
