Discouraging economic conditions have boosted demand for industry services
Los Angeles, CA (PRWEB) December 10, 2012
The Family Counseling and Crisis Intervention Services industry provides a range of social services, including counseling for alcoholism and drug addiction, rehabilitation services, shelter and food services, marriage and parenting counseling, crisis centers and self-help organizations. Because demand for these services is countercyclical, the industry recorded strong gains during the recession. In particular, demand for food and shelter services provided by the industry grew strongly during the period as the poverty rate soared from 13.0% in 2007 to a high of 15.3% in 2010, according to the latest data from the US Census Bureau. Furthermore, according to IBISWorld industry analyst Caitlin Moldvay, “illicit drug use has become more prevalent over the past five years, increasing demand for alcoholism and drug addiction counseling, as well as substance-abuse support groups.” During this period, the industry's revenue has grown at an average annual rate of 2.0% to an estimated $32.7 billion, including projected growth of 0.6% in 2012.
In response to heightened demand for industry services, government funding for industry social programs rose over the five-year period. For instance, the Temporary Assistance for Needy Families program received a $5.0 billion increase in emergency funding due to heightened nationwide poverty. Industry organizations receive funding for social programs from government grants, local businesses and individual donations, as well as operating fees, which are generally charged on a sliding-fee scale, meaning fees are based on what an individual or family can afford to pay. For-profit organizations in the industry recorded average profit margins of 2.8% in 2012, a slight decrease from 3.2% in 2007 due to lower per capita disposable income. Nonetheless, “the number of industry organizations increased over the period in response to a greater demand for industry services, especially for unemployed or poverty-stricken individuals,” says Moldvay. Because the Family Counseling and Crisis Intervention Services industry is already highly fragmented, with a large number of small organizations operating on a local level, the industry’s concentration has remained low.
Over the next five years to 2017, revenue is expected to continue growing, though at a slower rate than it did over the past five years. This slowdown will occur as the government implements cutbacks on social programs in light of continued concerns about the growing budget deficit. For example, federal funding for substance abuse prevention and treatment is expected to receive a significant budget cut during 2013. In addition, the crime rate is expected to continue on its long-term, downward trajectory, limiting demand for ex-offender recovery services and counseling for abuse victims. As the economy slowly recovers from the recession, the decline in the poverty rate will lessen demand for need-based programs as well. Nonetheless, demand for the industry’s services is not disappearing anytime soon, which is a factor that allows the industry to continue growing. For more information, visit IBISWorld’s Family Counseling & Crisis Intervention Services in the US industry report page.
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IBISWorld industry Report Key Topics
This industry includes establishments that provide nonresidential individual and family social assistance services. This includes counseling and support groups for alcoholism and drug addiction, abuse, marriage and parenting, crisis centers and family welfare services. This industry does not include social assistance services specifically for children, the elderly, or individuals with disabilities.
Key External Drivers
Industry Life Cycle
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Globalization & Trade
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