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Business spend sentiment improves; contingent labor is bright spot with spend up 22.8% Y/Y: Coupa Index

February 10, 2021

Business spend is gradually improving but remains below trend, though contingent labor is a bright spot, according to the Business Spend Index Q1 2021 Outlook released this week by Coupa Software (NASDAQ: COUP), a provider of purchasing software including a VMS.

The report released Tuesday found that business spend sentiment rose 2.9% year over year. Coupa’s report is based on anonymized data from transactions on its platform.

Sentiment aside, business spend was down in several areas. Business spending on air travel was down 96%; spending on office supplies was down 25% and spending on technology fell 11.5%.

On the other hand, business spending in the contingent workforce area rose 22.8% year over year. Spending also rose 12.3% on shipping and freight.

“While the Coupa BSI Q1 2021 Outlook shows modest improvement overall, a return to trend is unlikely until the number of new Covid cases reported daily has been significantly reduced,” Jeff Collins, chief economist at Coupa said. “Although government action to combat the economic consequences of the pandemic has likely mitigated the depth of the downturn, we do not expect the US economy to return to ‘normal’ levels of output or employment in the next three to six months.”