Over the last year, the growth of the UK’s consulting market slowed by over 10 per cent, and this isn’t slowing down anytime soon as this sector is expected to flatline this year.
The UK’s consulting market grew by 4.7 per cent across 2023 to revenues of £15.2bn, which was down on the 15.6 per cent growth recorded over 2022.
According to a new report from Source Global Research, macroeconomic headwinds and geopolitical uncertainty has created huge levels of unease for clients.
As these conditions are expected to continue, the report predicted that 2024 is going to be tougher for the market, as it is forecast growth to flatline.
The report also highlighted that while financial services remains the largest UK consulting market (£5.86bn), public sector is the fastest consulting growth as its forecast to have grown by 13.9 per cent (£1.89bn).
While it has a forecast growth of five per cent this year as it is set to be the strongest growing sector for consultants in 2024. The demand from the public sector is for IT strategy and planning as the sector looks to enhance back-office efficiencies and create more fluid user experiences.
While on this, cybersecurity work was in demand across many sectors, which resulted in it remaining the fastest-growing service in 2023 as it was up 17.2 per cent to £1.7bn.
The report highlighted that a steady stream of high-profile cyber attacks has prompted more companies to look at their existing infrastructures and boosting spend both on incident response advisory and penetration testing.
Despite this, this demand will be drying up as growth in cybersecurity is set to take a nosedive in 2024, as the report noted that cyber security work is forecast to shrink across the UK market by 3 per cent.
Commenting on the report, James Beeby, research lead at Source Global Research, said: “After strong market growth post pandemic, last year was a challenging year for UK consultants, and things are expected to get worse—with growth forecast to flatline this year.”
This is largely because companies are expected to adopt a wait-and-see approach to understand where to act if the economy begins to recover, and the upcoming general election will also complicate public sector spending,” he added.