The U.K. environmental consulting market contracted by 8.4 percent in 2010, and prospects for 2011 are relatively flat, market research firm Environment Analyst has found.
According to The 2011 Market Assessment of the UK Environmental Consulting Sector, last year the market declined for the second consecutive year after more than two decades of constant growth, to stand at £1.23 billion ($1.98 billion). The environmental consultancy field suffered from declining fees as just under 1,000 jobs were lost at the top 32 firms – eight percent of their staff.
Government austerity measures and a drop in local authority spending were largely responsible for the £113 million decline and will continue to hinder a return to growth, Environment Analyst said. Public spending was responsible for 70 percent of the 2010 decline, or £79 million. The private sector declined less sharply, losing £34 million.
Consultancies also became slightly less efficient last year, with a reduction in turnover per head, because of longer lead-in times and legislative uncertainties.
Environment Analyst predicts 0.5 percent growth for 2011, but said it has spotted a few encouraging signs. Sales to the regulated industries last year increased by £14 million. And nearly half of firms with revenues over £10 million reported that their Q1 2011 performance was better than they had budgeted for.
Environment Analyst says 2011 growth will be driven by capital infrastructure projects needed for stimulating the economy, along with strict legislative targets on energy, carbon and waste.
In terms of service areas, the only offering which grew substantially during 2010 was environmental policy and strategy, which grew by 14.7 percent. This might indicate increased CSR activity and investor pressure on multinationals, Environment Analyst said.
Environmental impact assessment and sustainable development remained the top income generators, though revenues in those areas fell by 12 percent. Turnover from climate change and energy services surpassed that from waste management for the first time.
Environment Analyst expects ecological/landscape services, climate change/energy, impact assessments, sustainable development, and sustainability policy and strategy services to be the strongest growth areas in 2011.
According to the researchers, the top 32 practices in the U.K. in order of market share are:
1. RPS Group
2. Halcrow Group
3. AEA
4. URS/Scott Wilson
5. Atkins
6. Mott MacDonald
7. Environmental Resources Management (ERM)
8. Jacobs Engineering
9. RSK Group
10. AMEC Environment & Infrastructure
11. Arup
12. WSP Environment & Energy
13. SKM Enviros
14. SLR Consulting
15. MWH
16. Capita Symonds
17. WYG Environment
18. Parsons Brinckerhoff
19. Bureau Veritas
20. Golder Associates
21. Mouchel Group
22. ADAS UK Ltd
23. Hyder Consulting (UK)
24. Environ
25. AECOM
26. PwC
27. Black and Veatch Ltd
28. Cefas (Centre for Environment, Fisheries & Aquaculture)
29. Wardell Armstrong
30. JBA Consulting
31. Arcadis
32. Waterman Energy, Environment & Design
