COVID-19 | Update for 24 April 2020

We're all facing unprecedented challenges in the next few weeks and months, in our daily lives, in our communities, and in our businesses. But we're already seeing evidence of how, if we work together, we can make a difference.

It's in that spirit of collaboration that Source has put together an estimate of the impact we think COVID-19 will have on the global consulting industry during the course of 2020. We're very grateful for the input of a wide range of firms from around the world who've helped us do this, providing up-to-the minute information on how we should adjust our existing model of the industry.

While based on the best information we have at the time of writing, our forecast and commentary are intended to be directional, providing guidance for future planning. In an environment where everything is changing very quickly, our predictions will inevitably change. Over the coming months, we will be updating the forecast on a weekly basis. For more information on our data and methodology, please see the end of this bulletin.

Please help us to help you: We've only been able to pull this forecast together so quickly because of the input of the hundreds of firms from all over the world who responded to our initial survey. Please help us by sending us your updates week by week, by following this survey link. Every single one of these responses helps us improve our forecasting.

Summary: 24th April

Our prediction for the impact of the COVID-19 crisis on the consulting industry for 2020 as a whole, compared to 2019, has deteriorated slightly, from -19% last week to -20%, largely as a result of a deteriorating situation in non-technology consulting in the US and more broadly in the UK. But there are signs that, where government plans around relaxing some of the lockdown restrictions are becoming clearer, client organisations are starting to think about how to adapt their business models for the next few months. While this has yet to translate into anything like significant volumes of consulting work, it’s nonetheless a positive sign.

The impact of even a small amount of certainty

As with every week, our headline number masks a host of positive and negative changes, but any shift in the US market has a huge impact, as it accounts for just under half of the global consulting industry. Here, we saw increasing signs not so much of ongoing projects being cancelled (most have made a successful transition to remote working and have continued) but of the shrinking pipeline of future work. Anticipating the effect that’s likely to have on utilisation and revenues in the second quarter of the year, the firms we speak to in the US are noticeably more sombre than they were a few weeks ago.

  Region 2019 (US$bn) 2020 forecast (US$bn) % change
North America 78.7 63.6 (19%)
Europe & Russia 43.2 33.5 (23%)
Asia Pacific 24.8 20.6 (17%)
Central & South America 5.1 4.3 (16%)
Middle East 3.6 2.7 (25%)
Africa 2.9 2.5 (12%)
  Total 158.4 127.3 (20%)

What prevents the US situation from looking worse is the resilience of revenues from technology consulting. This isn’t surprising: Technology consulting support is much in demand right across the world as organisations adapt to remote working, but the US market also benefits from a client base that has always been quick to adopt new technology, and this crisis is no exception. This means that, while the US as a whole is expected to shrink by 19% (down from 18% last week), technology consulting is likely to shrink by much less—around 6%.

Regular readers of our updates will notice that our forecast for the Middle East is also down, from -24% to -25%. Feedback from consulting firms based there was almost universally in the “deteriorated significantly” camp and this has been reinforced by announcements from some national governments (the one to watch is Saudi Arabia, which accounts for almost half of all consulting work in the region) that investment budgets are being slashed. One of the factors underpinning this is the falling price of oil, which even OPEC’s decision to cut output has failed to stem. Reflecting the impact of this globally, we’ve pushed our predictions for the energy & resources sector even more into the red, down from -28% last week to -31%. The situation in North America is especially dire, with storage capacity no longer able to cope with supply.

  Sector 2020 forecast
% change
Energy & resources (31%)
Financial services (11%)
Healthcare (27%)
Manufacturing (25%)
Pharma (3%)
Public sector (18%)
Retail (18%)
Services (34%)
Technology, media & telecoms (12%)
  Total (20%)

But for all this bad news we continue to believe that clients are moving out of the first phase of this crisis and are starting to look at what the next few months will hold. Crucially, in two key markets—China and Germany—there are signs of increasing activity. What this highlights is the value to business of increasing certainty.

The COVID-19 crisis has been unusual in its impact on the consulting industry, not simply in terms of its scale, but because the modern world is sailing in unchartered waters: By comparison, economic recessions and shocks (such as the global financial crisis) follow relatively predictable patterns. As a consequence, client organisations are not currently able to develop scenarios and plan their responses, which would in normal circumstances have prompted them to call strategy consultants in. Despite genuinely laudable attempts by strategy firms to give business leaders tools to help them navigate the crisis (McKinsey has done an especially good job), they’re not in a position to reduce uncertainty. Moreover, as hopes of a quick and clean end to the crisis evaporate, there’s clearly a danger that clients, and by extension the consulting firms who service them, will be paralysed.

The tentative evidence from China and Germany suggests that even a small reduction in uncertainty, combined with falling death rates from the virus, can start to have an impact, even though this isn’t necessarily enough to turn the tide. Equally, the situation for businesses in the US and UK is being made worse because there’s no evidence of a clear and consistent strategy to ending the lockdown. Consulting firms will therefore want to concentrate their attention on clients in markets where there’s both a plan for managing the post-lockdown environment and a sustained decrease in the rate of deaths. But both clients and consultants will need to take into account the probability that progress won’t be linear; it seems increasingly likely that varying degrees of restrictions are likely to come and go.

The question then becomes: What type of external support will these clients need in an environment where they have a sense of what the problems are likely to be, but not of their severity and duration? Unquestionably, they will want help with strategy, because being crystal clear about what business they’re in—or the part of their business they need to protect the most—will be critical. But “strategy” in this context means the ability to make very fast adjustments to their operations and technology. People who lived through the bubbling and bursting of the dot-com boom in the late 1990s will recall that the speed of technology change meant that corporate strategy projects, which would typically have taken many months to conclude, had to be re-engineered to take place over a period of weeks—a change that, incidentally, didn’t disappear with that crisis. So, it’s tempting to see the same thing happening here, to think that strategy will need to be much more responsive but will still be strategy as we know it. But it’s not clear whether that will be the case: There’s a fundamental difference between a strategy that is developed quickly and covers a shorter time frame and one that’s designed to cover an indeterminate period during which time the “strategy” may require daily adjustment. That organisations will need to respond to changes in weeks, days, or even hours represents an unprecedented shift in what strategy means. Strategy firms will no doubt adjust to this, just as they have done to changes in other crises, but despite the extent of their diversification into operational and technology areas over the last five years, they’re unlikely to be able to do so by themselves, because strategy and execution will become indistinguishable.

For the moment, we’re not changing our predictions for strategy work much: We still think it will contract by around 30% over the course of 2020. As we see more conditions in which clients start to plan for the mid-term (however long that lasts), we expect to see that number improve, but it’s possible that it won’t bounce back to the degree that it has done after other crises because more expenditure will go into operations, workforce planning, and technology.

Further questions

We've included details of our model and forecasting methodology below. If you'd like to know more about how we've created our forecasts or want to understand how the year is likely to play out at a more granular level for your firm, please contact


In order to calculate this forecast, we've taken the most recent forecast from our model of the consulting industry, which was prepared pre-crisis, in early January 2020. This unique model is built bottom-up, by estimating the number of people employed by several thousand major and mid-sized firms across 84 countries, 29 industries, and a range of services. We then apply a series of metrics and adjustments around the revenue per consultant. Where possible we validate this data against published sources and interviews with senior people in the firms concerned. Although some of our 10 million individual data points and assumptions may be wrong, when aggregated, they provide a robust view of consulting markets around the world. Moreover, because of the way this model has been built, we can adapt it to take account of new scenarios—as we have done here. In order to understand the likely impact of COVID-19 on the consulting industry, we've developed forecasts at the level of individual service lines, quarter by quarter, then modified these depending on industry and country. Please note that all the data in this bulletin is for the calendar year 2020 and is in US dollars. We've calibrated our assumptions with a number of major and mid-sized firms.


One of the greatest challenges with sizing any part of the consulting industry is that “consulting” means different things to different people. Over the last 12 years, Source has adopted a consistent definition, and this underpins all our published material about the consulting industry. It includes traditional management consulting services (strategy, HR & change, operational improvement, risk & regulatory work, and technology consulting), but does not include systems development and integration, and outsourcing services.


Our model also focuses on what we call "big consulting", work done by consulting firms with more than 50 consultants typically for clients with a turnover in excess of $500m.

About Source Global Research

Source Global Research is the leading provider of research about the professional services market. Founded in 2007, we serve the world's leading professional services firms and their clients with expert analysis, data, and insights. Firms come to us because they know we offer transparency in a notoriously opaque market. We provide direction and evidence about changes in the marketplace, helping firms cut through what can sometimes be intractable discussions around future direction by being objective and honest.

Data sits at the heart of what we do, and our model of the professional services market is the largest and most sophisticated in the world. Data in the model comes from extensive desk research, and interviews with over a thousand senior partners from around the world. It feeds into our customers' business strategies and helps them prepare for the future. We also place a strong emphasis on the views of clients of professional services firms (we conduct some of the largest interviews on this sector in the world) and listen to what clients need, and how their views are changing in the marketplace.

Please note that, because we work with such a wide range of firms, we take confidentiality very seriously. Our ongoing research programme, including interviews, and customised project work with individual firms, gives us an extensive foundation of knowledge and allows us to work on some of the most confidential issues these firms have.

Our independence and knowledge of the professional services industry means that we're trusted to set our work within the wider market context, helping firms make the most of the opportunities on offer. Our customers would tell you that we have a strong commitment to doing the very best for every firm we work with, and are thoughtful, friendly, and easy to work with.

Please help us to help you: We've only been able to pull this forecast together so quickly because of the input of the hundreds of firms from all over the world who responded to our initial survey. Please help us by sending us your updates week by week, by following this survey link. Every single one of these responses helps us improve our forecasting.