The third quarter of 2008 saw the lowest value of commercial outsourcing deals for six years, according to TPI, an advisory firm.
Its research found that 128 contracts worth a total of €11.5 billion were signed during the period July-September – a fall of 22 per cent in number and almost 50 per cent in both total and average contract value on the previous quarter. This represented the lowest figures since the third quarter of 2002.
Much of this decline was due to a slump in the Europe, Middle East and Africa (EMEA) region, which saw 56 contracts with a value of €4.4 billion signed in the third quarter compared to 75 deals and €14.8 billion for the previous quarter.
The fall meant that the Americas – with a total contract value of €4.5 billion – outperformed the EMEA region for the first time in almost two years.
“It seems likely that the sharp decline in outsourcing in EMEA in the past quarter is a temporary pause following the most intensive nine months of outsourcing activity in the region’s history,” said Duncan Aitchison, partner and president of TPI EMEA.
Aitchison added that he believed the overall total – in both value and volume – of outsourcing deals for 2008 would still exceed the figure for 2007. “Third quarters are traditionally weak and we see considerable activity in the market,” he said.
