The global environmental consulting market has slowed, according to Environment Analyst’s latest annual Market Trends Survey, completed by hundreds of environmental consultants and managers around the world who saw an average revenue growth of 3.1 percent within their environmental consulting businesses in 2015.
This is down slightly from the previous year’s survey, which saw revenue growth of 3.5 percent for 2014.
By comparison, global environmental consulting revenue growth rates for the years prior to that were 3.1 percent for 2013, 3.5 percent for 2012 and 1.2 percent for 2011.
The survey found larger practices — those with environmental consulting revenues of more than $15 million — are having a more difficult time growing than smaller firms. These larger companies reported internal revenue growth averaging -0.2 percent in 2015, down from the 1.1 percent reported for the previous year (see chart).
Firms with annual revenues of up to $15 million are showing more resilience with an average internal revenue increase of 3.8 percent last year — however, this still represents a drop from the 4.4 percent reported for 2014.
Environment Analyst attributes the larger firms’ slump to their exposure to the downturn in major mining and natural resources projects, and low oil and gas prices.
Waste management, environmental management and compliance, and “other” services are currently the strongest performers with growth rates averaging 6.2 percent, 5.9 percent and 5.8 percent, respectively. But across all twelve major work areas, current growth rates are lower than those reported in last year’s survey, with water quality and resource management as well as climate change and energy both seeing a significant reduction in reported growth year-on-year.
Despite the current downturn, the survey projects a slight improvement in the market over the next five years. Survey respondents project an average compound annual growth rate (CAGR) of 7.5 percent for the global environmental consulting market as a whole to 2020, up from the 5.6 percent projected in last year’s survey.