Final answer:
Managerial accounting is critical in service industries due to the economy's shift to being more service-oriented, the complexities of service delivery, and outsourcing trends stemming from globalization.
Step-by-step explanation:
Managerial accounting has become more important in service industries primarily due to the economy becoming more service-oriented. With a significant shift from manufacturing to service sectors, the largest part of GDP is now attributed to services, like healthcare, education, and legal and financial services. This transition is influenced by globalization, an increase in competition from foreign producers, and the jobs being more focused on interactions and service delivery rather than the production of solid goods. Hence, the complexity of managing efficient service delivery has necessitated the need for more robust managerial accounting information systems.
While the decline of manufacturing played a role in changing job landscapes, ultimately contributing to a more competitive and outsourced economy, the demand for managerial accounting in services is more so due to operational complexities rather than freed-up accountants. Moreover, the reduced presence of unions resulting from enhanced workplace protection laws has challenged the traditional labor structure, which managerial accounting also helps to navigate.