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| KN90007 |
| KEY NOTE CONTRACT CLEANING JUNE 1997 |
ISBN 1-85765-701-2

This report deals with the UK contract cleaning
sector, serving a market worth an estimated £2.23bn in 1996. The total
potential market for such services, which include in-house cleaning services,
is estimated at £5.3bn. The sector has shown average annual growth over
the past 5 years of 10.5 percent; in current price terms, around twice the rate of
growth in the economy as a whole.
Contract cleaning, as defined in this
report, encompasses a variety of cleaning activities, such as chimney sweeping,
office, shop and factory cleaning, ship fumigating and scrubbing, boiler
cleaning and scaling, telephone cleaning and sterilising, and window cleaning
services.
Among the influences that have had an impact on the sector
over the past 5 years has been the trend towards `outsourcing', where firms
concentrate their management effort on their core businesses and contract
non-core elements to specialists, such as contract cleaners. At the same time,
policies of the then Conservative Government in the UK were pushing the public
sector in a similar direction, through the application of legislation which
required `market testing' and `compulsory competitive tendering' procedures to
be followed.
Other legislative provisions have also had their effect on
the industry. The most notable of these has been the Transfer of Undertakings
(Protection of Employment) Directive of the European Union (EU). A series of
apparently conflicting court rulings as to the circumstances in which these
regulations apply, has led to a great deal of uncertainty in the industry.
Other legislation, both in force and in prospect, has dealt with issues such as
maximum hours of work, illegal immigrants, the minimum wage, and the
implementation of the Social Chapter of the Maastricht Treaty.
Forecasts of UK economic growth published by a range of forecasting bodies,
both public and private, suggest an annual average rate of growth in UK
domestic demand of 2.7 percent over the next 5-year period to 2001. This translates
into a rate of increase in current price terms of 5.5 percent per annum. In line with
the experience of most economies at a similar stage of development, the UK's
business service sector seems set to increase its share of economic activity,
and the contract cleaning industry seems likely to participate fully in this
growth. This produces a prediction for the total contract cleaning market of
£3.2bn by the year 2001.
Text © 1997 Key Note
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Last updated by Duncan Nottage 5th March 1999