Public sector and financial services dominate IT consulting

Big-ticket public sector projects and the financial services sector are driving the IT consultancy industry in the 21st century, according to Management Consultancy’s latest survey.

A combination of local and central government contracts were found to have generated 39% of total consultancy fee income, a massive leap in growth compared with 27% in 1996 and the low point in 1999 of a paltry 16%.

Local government on its own contributed 18%, while central government produced 21%.

Financial services followed close behind with 34%, while the remaining share was made up of ?other? (15%) and smaller markets, including retail (4%), utilities, communications (both 3%) and manufacturing (2%).

The survey suggests that the shift in public sector IT consultancy work is set to continue for some time to come, with local government and the NHS expected to grow 14% in terms of fee income this year, and financial services revenues set to rise by 6%.

Central government growth will stretch to 9% in 2005, similar to the shares for the transport (10%) and energy (8%) sectors.

The communications sector was found to be the surprise package, and is set to reverse its low fee income figure and grow by around 12% in 2005.

Many of the firms proved unable to define fee income by type of IT service. As a result of this, the ?general IT consultancy? category accounted for 46% of fee income, while supply chain and customer relationship management both took a 10% share.

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