of market insourced
Over the course of several decades, the UIM industry, especially in the Nordic countries, has experienced an increased outsourcing trend. This trend has been a consequence of several factors, including a general privatization trend in western countries and demand for greater efficiency combined with a reduced workforce within the public sector. As of 2020, a majority of the UIM markets in Norva24’s current markets are outsourced, with Denmark having a comparatively higher share of outsourced services at 90-95 percent compared to 70-80 percent in Norway and Germany, and 60-80 percent in Sweden. The outsourcing share of the UIM industry is also generally higher for renovation services than for inspection and cleaning services. Smaller and midsized municipalities also outsource inspection and cleaning services as well, while larger municipalities often have in-house capacity for planned jobs and contract supplementary providers in peak-demand situations and for short term interventions. Public in-house providers have in recent years experienced serious challenges to attract and retain skilled employees, which in certain cases have forced them to use private UIM service providers in the open market, even if in-house may have been the preferred solution.
The remaining share of the market is still insourced, primarily by larger public utilities. Norva24’s view is that if further outsourcing is realized it is most likely to be driven by municipalities in Germany, with additional potential in Sweden and Norway within areas such as housing associations and public utilities entities.