Business services are a broad category of industries that deliver non-physical goods and services to customers. They include a range of professions such as law, human resources and information technology, and they make up 11% of EU GDP.
The industry has grown rapidly over recent years as the digitalisation of business processes has facilitated the creation and provision of many different kinds of service solutions. In particular, the growing use of cloud computing and telecommunications has enabled the development of new types of services, and startups have emerged with innovative solutions that enable businesses to become more flexible and adaptable.
A wide range of business services are available to help companies manage their operations, and they are often the driving force behind the evolution of a company’s work culture. These include administrative and management support, IT services, facilities maintenance and security.
Providing business services involves an extensive range of activities, including the sourcing, procurement, development, marketing and delivering of services. This means that the industry is a global one, with service providers operating across different countries.
Business service providers are largely self-employed individuals, who provide a wide range of professional and technical services to firms. They may work for a specific organization as part of an outsourcing contract or they may be employed by a larger firm for a fixed term or on a contract basis.
There are a number of ways in which the industry provides value to companies and society at large, from helping them save time and money by offering outsourcing opportunities, to improving work conditions and making it easier for employees to get the jobs they want.
In terms of the European economy, business services are a key contributor to the supply chains of manufacturing and other sectors. They are essential to maintaining competitiveness in the market and play an increasingly central role in’servitisation’, where companies seek to improve their product’s value through the addition of non-physical goods and services to the overall value chain.
The EU has taken several steps to foster the growth of the sector, particularly through legislation and policy actions aimed at removing persistent legal barriers and stimulating competition in the sector. The EU’s ‘Services Directive’EN*** is one example of this. This aims to facilitate the cross-border provision of certain business services, including private security services and temporary work agency services.