Consumer spending on Home Service over the past 15 months has exceeded pre-pandemic levels; labor shortage fueling a need for new entrepreneurs and skilled workers
Jobber, the leading provider of home service management software, today released their latest Home Service Economic Report: Record Growth Fuels Labor Shortage. The report features expert insights and proprietary data aggregated from over 100,000 residential cleaners, landscapers, HVAC technicians, window washers, plumbers, and more, who use the Jobber platform.
“Despite the current labor shortage and fluctuating material availability, homeowner demand for home services remains at an all-time high, and businesses are experiencing positive growth in revenue,” said Sam Pillar, CEO & co-founder at Jobber. “Once supply chain disruptions subside and material costs decline to pre-pandemic levels, we expect growth to improve further.”
Homeowner Spending Continues to Grow
Consumer spending continues to drive revenue growth in Home Service, which has outperformed all other categories, including Grocery Stores and General Merchandise Stores in Q3. Long-term sustainable growth is expected through Q4 and into 2022:
- Construction Maintains Momentum: The number of new homes being constructed and new building permits issued continued to outpace pre-pandemic levels, with no indication of slowing down.
- Growing Invoice Sizes Across the Board: Invoice sizes saw an increase in all the main segments across Home Service, including Cleaning, Contracting, and Green, which includes landscaping, lawn care, and other outdoor services.
- New Work Growth Stays Positive: Despite the supply chain and labor shortage challenges, new work scheduled continued to show positive year-over-year growth for all segments. The growth in Cleaning was powered by a 21% increase in contract jobs.
Help Wanted, Inquire Within: Skilled Workers in High Demand
While the labor shortage has impacted Home Service less than other categories, the need for skilled workers is impacting the rate at which service businesses can book new work. This gap creates opportunity for both new entrepreneurs and workers seeking to pursue careers in Home Service:
- Hiring Now Key to Revenue Growth: Service providers who increased their headcount were able to schedule more work from the rise in consumer demand and grow revenue at a much faster rate.
- Increased Need for New Talent: The ratio of hires to job openings has decreased significantly, suggesting the current demand for talent is not being met.
- Labor Shortage Impacting Contractors: The Contracting segment showed positive growth in new work scheduled year-over-year in Q3 2021 but was impacted the most by labor shortages.
Growing Pains: Demand Outpacing Supply
While the Home Service category’s growth has shown resilience, there continues to be emerging and rapidly-changing economic trends that home service providers have to navigate:
- Shortages Holding Back New Work: While new work scheduled saw positive growth, this growth was slower year-over-year; increased cost of materials, material scarcity, and labor shortages are starting to cap the amount of jobs service providers can commit to.
- Unpredictable Cost Spikes: The prices of painting and coating manufacturing, and HVAC and commercial refrigeration equipment have increased, while gas and diesel prices reached peak levels last quarter. Steel mill products are the most impacted, seeing 122% growth over January 2020 prices.
- Lumber and Wood Back to Normal: In Q3, the cost of lumber and wood returned to levels experienced earlier in the year—which is still an increase of 24% compared to January 2020.
“Regardless of the obstacles that stand in their way, Home Service businesses continue to persevere and outperform nearly every other major category,” said Abheek Dhawan, VP, Business Operations at Jobber. “This speaks to the incredible resiliency of Home Service and the essential nature of the services these professionals provide. One key takeaway from this report that we want readers to walk away with, is that the best time to open a home service business, or pursue a career in the trades, is now.”
To download Home Service Economic Report: Record Growth Fuels Labor Shortage, visit: https://getjobber.com/home-service-reports/november-2021/