Cautious consumer spending in first half of 2024 to improve as inflation eases and interest rate cuts loom, predicts latest Jobber Home Service Economic Report

Jobber, a provider of home service software, recently released its latest Home Service Economic Report: 2024 Q2. The report features expert insights and proprietary data aggregated from more than 200,000 residential cleaners, landscapers, HVAC technicians, electricians, plumbers and more, who run their businesses using Jobber.

“While consumer spending was down the first half of the year and the performance of Home Service businesses was mixed, our customers are resilient and have shown us time and time again that they’re capable of navigating unpredictable market conditions,” says Sam Pillar, CEO & co-founder of Jobber. “We are optimistic that conditions in Home Service are improving and remain focused on helping our customers thrive in this evolving category.”

Consumer spending expected to increase in second half of 2024

In the first half of 2024, consumer spending has shown cautious growth, influenced by subsiding inflation and discussions of potential interest rate cuts. Despite these positive signs, consumers are feeling increased financial pressure, leading to a pullback in spending. However, service provider revenue has grown at low single digits due to higher average invoice sizes, and consumer spending is expected to increase in the second half of 2024 as inflation eases.

Performance across Home Service segments:

• Green: The Green segment, which includes lawn care, landscaping, and a range of associated outdoor services, showed steady growth with increased median revenue, reflecting consumer investment in smaller home upkeep projects.
• Cleaning: Despite a decline in new work, median revenue remained stable through higher prices and premium services. The Cleaning segment includes residential and commercial cleaning, carpet cleaning, junk removal, and other similar services.
• Contracting: The Contracting segment, which includes arborists, electricians, handymen, HVAC, plumbers and other non-construction contractor services, saw mixed results with flat growth overall, though certain months showed significant increases in median revenue.
• Construction: The Construction segment experienced the largest decline in new work being scheduled, impacted by high interest rates, but shows potential for recovery as inflation eases. The segment includes businesses in residential and commercial construction, remodeling and related industries.

Housing market creating headwinds for Home Service 

Home equity values continue to rise, but new permits and housing starts are declining, creating headwinds for the Home Service category for the rest of 2024 and 2025. Remodeling activity is slowing due to high interest rates and reduced consumer confidence but is expected to recover in early 2025 and is poised for long-term growth due to the aging housing stock.

“As we navigate the economic landscape of 2024, it’s clear that consumer demand is experiencing a cautious yet positive trend,” says Abheek Dhawan, senior vp, strategy & analytics at Jobber. “Although growth has cooled to low single digits in the first half of the year, increased average invoice sizes have helped service businesses maintain revenue. As inflation subsides and potential interest rate cuts loom, we anticipate a boost in consumer spending in the latter half of 2024 and into 2025. This will likely drive growth in the Home Service sector, particularly as housing and home improvement services become more affordable.”

To download the Jobber Home Service Economic Report: 2024 Q2, visit: https://getjobber.com/home-service-reports/aug-2024

About Jobber

Jobber is an award-winning software for small home service businesses. Jobber is used by more than 200,000 home service professionals to serve over 27 million properties in more than 60 countries.