Demand for facilities management services has been growing during the period in line with increases in the number of businesses nationwide.
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General Contractor Services
The value of construction has been rising strongly in the past three years, fueled in part by low interest rates, which have encouraged businesses to invest in construction projects. These factors have led to an increase in demand for general contractor services, which has incited price growth and hindered buyer power.
Rising demand has been the primary contributor to recent price growth. Fortunately for buyers, stiff market competition has prevented janitorial service prices from rising more rapidly.
Security Guard Services
Large providers of security guard services have been raising their prices at a faster rate than the market average and have thus benefited the most from growing demand for services. These vendors’ diversified service offerings give them more room to implement price increases without risking a significant loss of business because their larger customers can still source multiple services from them and still save money.
Solid Waste Collection & Disposal Services
Recent price growth can largely be attributed to the rising cost of complying with new and changing regulations, such as landfill capping standards and changes to the Clean Air Act of 1970. These changes have been forcing haulers to invest in new collection trucks and other related operating equipment and machinery, thereby increasing their operating costs.
401(k) Administration Services
While input costs and demand drivers affect service prices, the price trend can be better attributed to the introduction of regulation forcing companies to disclose fees more clearly, which has then driven down service prices.
rising demand for services has been the primary driver of price growth in the past three years. The number of businesses determines the size of the pool of companies in need of accounting services and has risen as companies have gained cheaper access to capital.
Auditors have been deterred from adjusting rates for services too rapidly for fear that their clients may defect to competing firms. As a result, buyers have been able to budget accurately for purchases of audit services during the period.
Business Credit Card Services
APRs for business credit cards have risen an estimated 0.6 percentage points. As inflation has been rising and unemployment has approached its natural rate, the FOMC has started to increase the target range for the federal funds rate after nearly a decade of stagnancy.
A growing number of employees has added to the complexity of payroll, because businesses have had to do more back end work to integrate new workers into their operations. As a result, businesses have been compelled to outsource the administration of payroll to third-party processors, strengthening demand for payroll services.
Contingent Workforce Management Services
The number of temporary employees has maintained considerable growth during the period. As the contingent workforce has expanded, businesses have faced more regulatory compliance and vendor management concerns, leading them to increasingly demand for contingent workforce management services
Group Health Insurance
The cost of reimbursing healthcare providers for the services they render on behalf of plan participants is a primary expense for health insurance carriers, referred to as claims and benefits. The price of healthcare services has been rising, resulting in higher costs for insurers during this period. Insurers have passed these cost increases to buyers in the form of higher premiums.
Human Resources Software
In recent years, HR software programs have begun to offer a multitude of measurements and control tools to help businesses with recruitment, payroll, training and other core HR functions. Increased accessibility and functionality have helped generate more demand for HR software, which has allowed suppliers to raise prices.
Personnel Relocation Services
Demand for personnel relocation generally follows overall trends in the broader economy; improvements in the economy boost business growth, encouraging businesses to expand to a greater number of locations. In turn, businesses must typically relocate some employees to facilitate this growth.
Reference & Background Checking Services
Landlords represent a large buying segment for suppliers of background checking services because they conduct checks on potential tenants. As demand for housing rentals has increased, the decline in rental vacancies has driven demand for background checking services.