Industries with the Highest Labor Costs in the US in 2025

1. Management Consulting in the US

Labor Costs for 2025: $197.6B

Providing varied services to diverse downstream markets with unique needs allows management consultants to weather changing economic conditions. Extreme shocks like the COVID-19 pandemic led to revenue declines, but sometimes clients need consulting services in bad times, which buffers revenue declines and ensures low revenue volatility. Bouncing back from the COVID-19 pandemic, industry-wide revenue grew at a CAGR of 1.1% to $329.9 billion over the past five years, growing 0.1% in 2023 alone.

Technological change in client markets will spur demand for various consulting services, but challenge profit margin growth. Advisory in the age of digital transformation requires employees with unique... Learn More

2. Investment Banking & Securities Intermediation in the US

Labor Costs for 2025: $148.8B

Strong returns in various financial markets and increased trading volumes have benefited businesses in the industry. Companies provide underwriting, brokering and market-making services for a range of financial instruments, including bonds, stocks and derivatives. Businesses benefited from improving macroeconomic conditions and interest rates remaining below historical averages. Overall, industry revenue has been growing at a CAGR of 11.5% over the past five years and is expected to total $492.1 billion in 2023, when revenue will jump by an estimated 22.3%.

While many industries struggled in 2020 as a result of COVID-19, businesses benefited from the volatility caused by the pandemic. Primarily,... Learn More

3. Engineering Services in the US

Labor Costs for 2025: $133.4B

Engineers develop structures, machines, materials and other processes and systems. Services include providing advice, feasibility studies, designs and technical services during construction or development. Engineering services revenue has grown at a CAGR of 3.3% to $360.1 billion over the five years to 2023, expanding in line with its historical growth. However, COVID-19 led to less demand across nearly all downstream markets in 2020. The economy's quick recovery contributed to strong revenue increases in 2021 and 2022. Despite ongoing challenges in certain markets, such as nonresidential construction, revenue will grow 0.7% in 2023 alone.

Large engineering companies have increasingly invested in technology... Learn More

4. Online Computer Software Sales in the US

Labor Costs for 2025: $115.8B

There is a wide range of computer software applications currently available and that continue to be launched yearly for both business and personal use, leading the Online Computer Software Sales industry to have numerous vertical markets. The industry has largely benefited from the gradual digital transformation that runs concurrently with macroeconomic growth. However, while many facets of the global economy have suffered during COVID-19 and accompanying economic burdens, online retailers have benefited tremendously from increased digital screen time for work and leisure purposes. So, industry-wide revenue has been increasing at a CAGR of 6.0% over the past five years, including... Learn More

5. Emergency & Other Outpatient Care Centers in the US

Labor Costs for 2025: $92.0B

The Emergency and Other Outpatient Care Centers industry has grown as the aging population and the nondiscretionary nature of this industry's services has bolstered revenue. The Patient Protection and Affordable Care Act (PPACA) has expanded public healthcare coverage and promoted the role of outpatient facilities, despite changes to the healthcare law in recent years. Revenue has resumed fast growth following the outbreak of the COVID-19 pandemic, which delayed high-profit elective surgeries, temporarily limiting demand. With delayed demand pushing revenue growth to near double-digits in 2021, total industry revenue will rise at an average annual rate of 3.8% to $220.1 billion... Learn More

6. Single Location Full-Service Restaurants in the US

Labor Costs for 2025: $76.9B

The growing domestic economy led to consistent but modest increases in consumer spending on full-service restaurants. The fine-dining segment performed particularly well over the past five years due to solid growth in the income levels of affluent consumers. Nevertheless, industry operators were forced to curtail dine-in operations when the coronavirus struck, thus reducing demand for fine-dining restaurants as services at these establishments involve a high degree of in-person experience. Simultaneously, restaurants at the lower end of the market struggled as consumers traded down to the innovative products served by a growing number of new high-quality fast-casual chains.

The majority of operators... Learn More

7. Warehouse Clubs & Supercenters in the US

Labor Costs for 2025: $72.4B

Swings in the general economy mostly don't impact the Warehouse Clubs and Supercenters industry because of their low-priced offerings. Specifically, when consumer sentiment is high, shoppers spend more when visiting industry establishments and buying extra items. Conversely, when consumer sentiment is low, warehouse clubs and superstores draw a larger pool of consumers as households seek to cut expenses by buying in bulk for the future. Furthermore, warehouse clubs and supercenters are considered essential businesses and have experienced relatively little disruption throughout COVID-19 and the continued unstable economic conditions. Industry revenue has been increasing at a CAGR of 2.0% over the... Learn More

8. Health & Medical Insurance in the US

Labor Costs for 2025: $64.7B

The Health and Medical Insurance industry, which is made up of carriers of private and public health, medical and dental insurance, has grown. This growth is a result of consistent increases in healthcare expenditure and medical cost inflation, in addition to a decline in the uninsured rate. Industry revenue is correlated with total health expenditure, as operators increase premiums to maintain profitability. Due to the COVID-19 pandemic, the industry experienced an influx of enrollment through expanded Medicaid eligibility, in addition to lower operating costs due to lower healthcare utilization. As unemployment increased, many people lost their employer-sponsored health insurance, causing... Learn More

9. Couriers & Local Delivery Services in the US

Labor Costs for 2025: $59.8B

The industry comprises two segments: larger couriers and smaller local delivery companies. Together, these segments cater to various consumers, with demand for each segment differing based on the services offered. Specifically, downstream demand for courier services comes from manufacturers and retailers across the country, while demand for local delivery services is derived from households and other local markets. Although the markets for each segment differ, demand for each segment tends to fluctuate in line with consumer spending, the number of businesses and e-commerce sales, all of which have increased in recent years. The onset of the COVID-19 pandemic exacerbated the... Learn More

10. Electric Power Transmission in the US

Labor Costs for 2025: $51.7B

The Electric Power Transmission industry transmits and distributes electricity from power generators to distribution centers, other electric utilities and consumers. The increased infrastructure investment has allowed companies to raise rates, increasing revenue and profit. During the pandemic, power consumption was sluggish since many commercial and industrial businesses were forced to close. Residential consumers used more electricity because of stay-at-home orders, cushioning the blow from the decline in other sectors. The following year, an economic recovery led to a rebound in those markets as businesses reopened. Overall, industry revenue is set to increase at an annualized rate of 0.6% to $505.0... Learn More