Professional Services Market to grow by USD 2.07 Trillion from 2024-2028, driven by the push for digitalizing business processes and AI's role in reshaping the landscape - Technavio

NEW YORK, Oct. 28, 2024 /PRNewswire/ -- Report with market evolution powered by AI - The Global Professional Services Market size is estimated to grow by USD 2.07 trillion from 2024-2028, according to Technavio. The market is estimated to grow at a CAGR of 5.7% during the forecast period. Growing focus on digitalizing business processes is driving market growth, with a trend towards growing trend of using AI and ML in professional services industry. However, shortage of skilled professionals poses a challenge.Key market players include Accenture Plc, AECOM, Aon plc, Bain and Co. Inc., Boston Consulting Group Inc., Business Connexion Ltd., Charles Ghadban Accounting, Cleary Gottlieb Steen and Hamilton LLP, Deloitte Touche Tohmatsu Ltd., Dentsu Group Inc., Enviro Analysts and Engineers Pvt Ltd., Ernst and Young Global Ltd., FinExpertiza, Forvis Mazars, Oliver, Wyman & Company, Omnicom Group Inc., PricewaterhouseCoopers LLP, Publicis Groupe SA, Slalom Consulting LLC, and Tata Consultancy Services Ltd..

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Market Driver

The professional services industry is undergoing a major transformation through the integration of artificial intelligence (AI) and machine learning (ML). Firms like Ernst and Young Global Ltd. (EY) and PricewaterhouseCoopers LLP are leading this change by offering AI-enhanced services. EY's AI solutions boost efficiency, accuracy, and productivity in areas such as auditing, tax consulting, and financial analysis. Similarly, PwC's AI-powered offerings augment consultancy, accounting, and financial advisory services, enabling analysis of large datasets and identification of patterns for data-driven insights. In the legal sector, AI tools reduce document review and legal research time and cost. In financial services, ML algorithms detect fraud and predict market trends. Consulting benefits from AI analysis of large datasets and chatbots for client engagement. Innovation in professional services is fostered through predictive analytics and automation, leading to cost savings and increased efficiency. These trends fuel the growth of the global professional services market. 

The professional services market is experiencing significant trends in communication, digital transformation, and cybersecurity. Businesses are focusing on improving communication channels for enhanced collaboration and customer engagement. Digital transformation is a priority, with the adoption of cloud-based services like SaaS and cloud computing increasing. Cyber breaches and identity theft remain concerns, driving the need for data security measures and adherence to frameworks like NIST Cybersecurity. Project-oriented services and IT outsourcing (ITO) continue to be popular. AI, ML, IoT, and digital media are transforming business processes. Real-time data and automation are key benefits of cloud technology. Blockchain technology offers secure financial transactions. Cyberattacks and cybercrime necessitate strong security measures, incident response plans, and adoption of advanced technologies like AI and ML. Cloud-based accounting software streamlines financial transactions. 

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 Market Challenges

• The professional services industry is experiencing a significant challenge: a shortage of skilled professionals. This issue is hindering firms' ability to meet client demands, maintain service quality, and drive growth. The root cause is the rapid technological advancement, which has increased the demand for professionals with expertise in areas like artificial intelligence, machine learning, and data analytics. However, the supply of skilled professionals has not kept pace, resulting in a talent gap. For instance, the manufacturing sector lost about 1.4 million jobs during the pandemic but was already facing a potential labor crisis, with 2.1 million unfulfilled jobs by 2030 due to a lack of skilled labor. Similarly, healthcare projects a shortage of over 4 million workers by 2026 as more than 6.5 million professionals are expected to leave their positions. Competition from sectors like technology, finance, and healthcare for similar skill sets further complicates matters, driving up salaries and making it harder for professional services firms to attract and retain top talent. An aging workforce and demographic shifts, including the retirement of experienced professionals and the preference for flexible work arrangements, are also contributing to the scarcity of skilled workers. These factors are expected to negatively impact the growth of the professional services market.
• The Professional Services industry encompasses a wide range of services including consulting, legal, accounting, IT, design, research, promotional, scientific, technical, and more. Service providers offer advisory support, specialized technical services, and experience management (XM) solutions using platforms like Qualtrics. Challenges include managing business processes, cyber threats, incident response, financial data management, and remote working. Technology, such as generative AI, plays a crucial role in enhancing customer experience and streamlining operations. Large enterprises require online and offline services, hybrid solutions, and professional services software for invoice and expense management, resource allocation, and project management. Talent acquisition and resource management are key areas of focus. Automated billing and financial auditing ensure accurate and efficient service delivery. Environmental consulting and business strategies are essential for sustainable growth. Tax preparation services and translation services cater to specific needs. Technology continues to transform the industry, offering opportunities and challenges alike.

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Segment Overview 

This professional services market report extensively covers market segmentation by

1. Industry Application
• 1.1 Financial services
• 1.2 Technology
• 1.3 Healthcare
• 1.4 Manufacturing
• 1.5 Others
2. Delivery Mode
• 2.1 On-site services
• 2.2 Remote services
• 2.3 Hybrid models
3. Geography 
• 3.1 North America
• 3.2 Europe
• 3.3 APAC
• 3.4 South America
• 3.5 Middle East and Africa

1.1 Financial services- The Professional Services Market refers to businesses that provide expert advice, consulting, and specialized services to other organizations. These services can include finance, legal, human resources, technology, engineering, and marketing. Companies in this market help clients improve their operations, reduce costs, and navigate complex business challenges. The market is expected to grow due to increasing business complexity and the need for specialized expertise. Firms offer customized solutions to meet unique client needs, ensuring optimal business performance.

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Research Analysis

The professional services market is experiencing significant transformation as businesses digitize their operations using advanced technologies like Artificial Intelligence (AI), Cloud technology, and Blockchain. These technologies are revolutionizing various industries by automating business processes, enhancing customer experience, and providing specialized technical services. However, with the increased use of technology comes the risk of cyberattacks and cybercrime. Service providers are responding by offering incident response plans, security measures, and cloud-based accounting software as part of their offerings. Professional services include advisory support, consulting, legal, accounting, scientific, design, promotional, and research services. Large enterprises are increasingly relying on IT services and professional service firms for automation, business strategies, and remote working solutions. The integration of AI and technology is enabling service providers to offer more efficient and effective solutions to their clients.

Market Research Overview

The professional services market is undergoing a significant digital transformation, with businesses increasingly adopting cloud technology, artificial intelligence (AI), and blockchain technology to digitize their processes. This shift brings new opportunities for service providers, including IT, consulting, accounting, legal, and design firms, to offer specialized technical services, advisory support, and project-oriented solutions. However, this digital evolution also presents new challenges, such as cyberattacks and cybercrime. Service providers must implement security measures, including incident response plans and cloud-based accounting software, to protect financial transactions and sensitive data. AI and machine learning (ML) are driving innovation in areas like experience management (XM) and automation, enabling real-time data analysis and enhanced customer experience. Large enterprises are turning to SaaS solutions for remote working and business strategies, while smaller firms are exploring hybrid services that combine online and offline offerings. Professional services firms must also address cyber threats, such as cloud-based breaches and identity theft, by adhering to frameworks like the NIST Cybersecurity Framework and investing in data security. The future of the professional services industry will be shaped by digital transformation, automation, and the ability to adapt to an ever-evolving technological landscape.

Table of Contents:

1 Executive Summary
2 Market Landscape
3 Market Sizing
4 Historic Market Size
5 Five Forces Analysis
6 Market Segmentation

• Industry Application
• Financial Services
• Technology
• Healthcare
• Manufacturing
• Others
• Delivery Mode
• On-site Services
• Remote Services
• Hybrid Models
• Geography
• North America
• Europe
• APAC
• South America
• Middle East And Africa

7 Customer Landscape
8 Geographic Landscape
9 Drivers, Challenges, and Trends
10 Company Landscape
11 Company Analysis
12 Appendix

About Technavio

Technavio is a leading global technology research and advisory company. Their research and analysis focuses on emerging market trends and provides actionable insights to help businesses identify market opportunities and develop effective strategies to optimize their market positions.

With over 500 specialized analysts, Technavio's report library consists of more than 17,000 reports and counting, covering 800 technologies, spanning across 50 countries. Their client base consists of enterprises of all sizes, including more than 100 Fortune 500 companies. This growing client base relies on Technavio's comprehensive coverage, extensive research, and actionable market insights to identify opportunities in existing and potential markets and assess their competitive positions within changing market scenarios.

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SOURCE Technavio