Janitorial Services
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 62,100 janitorial service providers in the US clean building interiors, windows, and the interiors of transportation equipment, such as aircrafts. Specialized services include disaster recovery, medical cleaning, and mold clean up. Some companies provide outdoor services, such as snow removal and lawn maintenance. Non-residential customers, such as those in institutional, office, and commercial buildings, account for 80% of industry revenue.
Immigration Laws
Most janitorial jobs do not require workers with English-speaking skills, and tend to attract both legal and undocumented immigrants.
Green Cleaning
Growing concern with the environment and sustainability issues has led to increased demand for the use of eco-friendly cleaning products and methods.
Industry size & Structure
The average janitorial services provider operates out of a single location, employs about 16 workers, and generates $1 million annually.
- The janitorial services industry consists of about 62,100 companies that employ over 1 million workers and generate about $73 billion annually.
- The industry is highly fragmented; the top 50 firms account for 28% of industry sales.
- The industry includes national and regional companies, franchises, and independent operators.
- Large companies include divisions of ABM, Authority Brands (The Cleaning Authority), Neighborly (Molly Maid), and ServiceMaster (Merry Maids).
- Non-residential customers, such as those in institutional, office, and commercial buildings, account for 80% of industry revenue.
Industry Forecast
Janitorial Services Industry Growth
Recent Developments
Jul 9, 2024 - Heat Illness Prevention Rule Proposed by DOL
- Janitorial services will want to prepare for a new proposed rule from the US Department of Labor (DOL) designed to protect workers from extreme workplace heat. The proposed rule requires employers to form an injury and illness prevention plan to control heat hazards in workplaces affected by excessive heat, per the DOL. The rule asks employers to evaluate heat risks and implement requirements for drinking water and taking rest breaks. In addition, employers will have to provide training, develop procedures to respond to employees who show signs of heat-related illness, and assist workers experiencing a heat emergency. The Occupational Safety and Health Administration (OSHA) currently conducts heat-related inspections under a program launched in 2022 to prevent worker injuries and illness. Cleaning crews can encounter extreme heat in commercial and residential buildings that are not properly ventilated or cooled and if they have responsibilities that include exterior maintenance.
- Consumer confidence levels fell in June 2024, after an uptick in May, according to data from The Conference Board. The Conference Board’s consumer confidence index was 100.4 in June 2024 from 101.3 in May 2024. Dana Peterson, chief economist at The Conference Board, noted that confidence was the highest among those under age 35 and those in the income category of over $100,000. Plans for large appliance and smart phone purchases rose on a six-month basis, while plans for car purchases stalled.
- The Institute for Supply Management reported its services-sector PMI contracted to 48.8% in June 2024 from 53.8% the previous month. It was the second contraction in a three-month period, following 15 consecutive months above the baseline growth. The report tracked the performance of 18 service sectors, out of which eight posted gains in June. Growth sectors include Other Services; Management of Companies & Support Services; Health Care & Social Assistance; Construction; Utilities; Finance & Insurance; Educational Services; and Professional, Scientific & Technical Services. Eight sectors showed a decrease in June, including Agriculture, Forestry, Fishing & Hunting; Real Estate, Rental & Leasing; Mining; Retail Trade; Public Administration; Wholesale Trade; Transportation & Warehousing; and Information. The Services PMI report is based on data from purchasing and supply executives nationwide compiled by the ISM.
- US office vacancy rates reached a 30-year high of 19% in the first quarter of 2024 compared to 17.8% in the same quarter a year ago, according to real estate firm CBRE’s 1Q office report in Facilities Dive. The majority of the 57 office markets tracked by CBRE in Q1 saw negative net absorption, meaning more space was vacated than leased. Still, tenant downsizing has slowed in the past 12 months as part of a gradual rebound, according to a JLL report on Q1 US Office Market Dynamics. The report expects office leasing to reach 85% of pre-pandemic levels in 2024. Office occupancy levels are a demand indicator for janitorial services.
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