Professional and Business Services A Varied and Growing Sector

by Brian Rooney

July 7, 2021

Professional and business services has added a lot of jobs in recent years. It is a large and varied industry super sector that includes everything from law offices, engineering services, and computer systems design to company headquarters, temporary help firms, call centers, and janitor services. It is separated into three sectors: professional and technical services, management of companies, and administrative and waste services. More information on the employment and wages of the industries in professional and business services can be found at our QualityInfo.org website.

The overall super sector employed 241,890 in 2020, roughly 13% of total employment in the state. The largest sector was professional and technical services, which included 17,830 firms with 98,339 workers. The largest industries in professional and technical services are computer systems design and related services with 16,735 workers, engineering services with 11,098 workers, and accounting and bookkeeping services with 11,005 workers. Wages in this sector are high, averaging $79,760 in 2020.

The next largest sector is administrative and waste services with 7,462 firms and 94,696 workers in 2020. The largest industries in administrative and waste services are temporary help services with 29,393 workers, landscape services with 10,928, janitorial services with 10,585, and telephone call centers with 9,420 workers. Wages are relatively low in this subsector, at an annual average of $43,917.

Finally, the management of companies and enterprises industry included 1,344 firms and 48,855 workers. This subsector is largely made up of bank holding companies and company headquarters. Wages are the highest among the three subsectors, averaging $138,714 annually.

A relatively small amount of professional and business services jobs are in government with 6,174 in 2020. Like the private sector, the industries are varied, but jobs in engineering, landscape architectural services, computer systems design, and janitorial services are the most prevalent.

Employment Trends

Professional and business services in Oregon has grown almost continuously since the early 1990s, declining for only short periods during recessions. Between 1990 and 2000 the sector grew rapidly, adding 83,300 jobs and growing by 80% compared with 29% for total private-sector employment. Professional and business services accounted for 23% of total growth during the decade.

Much of the growth in the 1990s can be attributed to the increased use of employment services, especially temporary help firms that take care of hiring for companies in a wide range of industries. Employment services added 28,800 jobs for a growth rate of 181% over the decade. The fastest growing industry in the sector was computer systems design, which grew by 263% while adding 8,400 jobs.

The relatively mild economic downturn that lasted from 2000 to 2003 was particularly hard on professional and business services. While total employment declined by only 3%, professional and business services dropped 6%. This period included the recession known as the Dotcom Bust, which was a correction in the high-tech industry. The computer systems design industry lost roughly 3,500 jobs or 30% of its employment. In addition, employment services lost 10,200 jobs, or 23%. Telephone call centers actually grew during this period, adding roughly 2,700 jobs.

After a short recovery period between 2004 and 2007, the economy fell into the Great Recession. Professional and business services dropped 16,000 jobs or 8.2%. The professional and technical sector dipped only slightly during the recession because computer systems and design actually gained 600 jobs over the period. Management of companies also added about 1,700 jobs. The largest loss came from the volatile temporary help industry, which lost 14,800 jobs or 35% between 2006 and 2009. The temporary help industry also helped the overall super sector start to recover earlier from the recession, making it a leading indicator.

After the Great Recession, the professional and business services sector in Oregon outpaced the growth of the overall economy, adding 72,722 jobs between 2010 and 2019 for a 40% growth rate. This compares with a growth rate of 22% for total employment. The professional and technical sector added the most jobs of the three sectors, especially the computer systems design industry, which added 7,309 jobs (+76%) and management consulting services which added 4,667 jobs (+97%).

Management of companies had the highest percentage increase after the recession, adding 65% and 19,955 jobs although some of that growth is from redefining companies into the industry.

In the administrative and waste management subsector, which added 22,756 jobs between 2010 and 2019, temporary help services grew by 7,824 (+28%) to reach 35,646 although the industry has not regained its 2006 peak of 38,825 jobs. Telephone call centers added 2,500 (+26%) jobs between 2010 and 2013 to reach 12,300, but dropped jobs since to reach 9,828 in 2019.

Professional and business services fared somewhat better than total employment during the COVID-19 recession, dropping 5% compared with almost 7% for all private-sector industries. In the professional and technical services subsector the losses were somewhat less, dropping 1,423 jobs (-1%), likely because many jobs in this sector can be done from home. The largest industry level job losses in professional and technical services were in other services related to advertising which lost 571 jobs (-73%) and photographic services with a decline of 202 jobs (-54%). There were significant increases in physical, engineering, and biological research at 337 jobs (7%) and other technical consulting services with 291 jobs (6%).

Management of companies and enterprises was down 1,615 jobs (-3%) during the COVID-19 recession.

The administrative and waste services sector includes many frontline jobs that cannot be done from home or are related to industries that were negatively affected by COVID-19 restrictions. This sector had a loss of 8,744 jobs (-10%). The largest loss was in temporary help services with a decline of 6,253 (-21%). Other significant losses were in telephone call centers which dropped 970 (-7%), collection agencies with a decline of 364 (-55%), and travel agencies which lost 313 (-64%).

Differences in the Sector’s Industry Mix Determine Wages

The professional and business services super sector is so varied that different geographies have different industry mixes within it. Areas with a high proportion of employment in the higher-paying professional and technical and management of companies industries will have relatively higher average wages while those that have a high proportion in industries such as call centers and temporary help firms will have relatively lower wages.

Some metropolitan counties like Washington and Multnomah have large shares of employment in professional and technical industries and company headquarters and therefore have high annual average wages. However, some nonmetropolitan counties have high wages within the super sector. For instance, Morrow County has a large share in data services, Hood River has a relatively large share of employment in engineering, and Gilliam County has employment in management of companies and waste remediation. Other rural counties that have employment in a company headquarters can have high wages within professional and business services.

Outlook

Professional and business services is expected to continue adding jobs into the future. Oregon Employment Department projections for 2019 through 2029 show it is expected to add 33,000 jobs for a 13% growth rate. At the industry level, computer systems and design is expected to add the most jobs at 4,400 and grow the fastest at 26%.


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