The death industry is undergoing significant changes due to rising costs, declining demand, consolidation, and government scrutiny.

The death industry is undergoing significant changes due to rising costs, declining demand, consolidation, and government scrutiny.

The Changing Landscape of the Funeral Industry

The funeral industry is experiencing a significant transformation, with a shift away from traditional burial practices towards cremation. This change can be attributed to several factors, including a decline in religious observance, cost considerations, and environmental concerns.

A Collapsing Business Model

The historic business model of preserving and burying bodies is collapsing. Rising inflation and declining religious participation have disrupted the traditional practices that small family businesses in the mortuary industry have relied on for decades. Additionally, private equity interests have begun consolidating these businesses, creating larger, more powerful entities.

The growth of the funeral industry is now centered around cremation, which relies on fossil fuels and volatile costs. This shift, combined with increasing pressure for price transparency from the Federal Trade Commission, has created a challenging environment for funeral providers.

The Rise of Cremation

In 2015, the cremation rate in the United States surpassed the rate of casket burial for the first time, according to the National Funeral Director’s Association (NFDA). This trend shows no signs of slowing down. Several factors contribute to the growing demand for cremation.

One significant reason is the decline in religious participation across the country. Traditionally, funerals involved a viewing, a church service, and burial. However, as fewer people attend religious services, the need for a religious aspect in memorializing loved ones diminishes. Consequently, many individuals question the necessity of traditional burial practices and consider cremation as a more viable option.

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According to a report from the Public Religion Research Institute, only 43% of Americans attended religious services “at least a few times a year” in 2022, compared to 56% in 2013. This decline in religious observance contributes to the shift towards cremation.

Another driving factor is the cost. Cremation is often 40% cheaper than traditional burials, making it an attractive option for individuals and families facing financial constraints. The demand for affordable post-death options is particularly significant as the poverty rate among elderly Americans continues to rise.

Increased consolidation within the funeral industry, with funeral homes being purchased by chains and private equity-backed firms, has also raised concerns about escalating prices for funeral-related services. Consumer advocates worry that private equity involvement may hike prices, further driving individuals towards the more affordable option of cremation.

Exploring Alternative Options

While cremation offers a cost-effective alternative to burial, it does come with environmental concerns. Each cremation releases more than 500 pounds of carbon dioxide into the atmosphere. As a result, funeral homes are beginning to explore and offer newer-age alternatives such as “aquamation” and human composting.

Aquamation, also known as alkaline hydrolysis, involves dissolving the body in a vessel, leaving behind only the bones, which are then ground up. Although there may be an initial “ick factor” and concerns about the disposal of the alkaline fluid, funeral homes specializing in aquamation argue that the funeral industry already deals with various challenging tasks associated with handling deceased bodies. Therefore, the apprehension towards aquamation diminishes once individuals consider the overall context.

Natural organic reduction, or human composting, is another environmentally friendly option that some consumers are choosing. This process involves placing the body into a vessel with plant materials for 30 days, allowing it to decompose and turn into soil. After removing any nonorganic materials, the remaining bones are crushed, and the resulting soil can be used by the family or for conservation projects.

The Push for Price Transparency

As the funeral industry undergoes these changes, consumers and advocates are calling for increased price transparency. Currently, funeral homes are not required to publish their prices online, although they must disclose prices over the phone or through physical price lists.

The Federal Trade Commission is currently considering an update to the “Funeral Rule” enacted in 1984, which could potentially require funeral homes to post their prices online. This proposed change is met with mixed responses. The National Funeral Directors Association voices concerns about government intervention, advocating for funeral homes to have the choice of whether or not to publish their prices. However, consumer advocates like the Funeral Consumers Alliance argue that online price transparency would benefit consumers and ease the burden on organizations that compile price surveys.

In conclusion, the funeral industry is facing significant transformations, driven by factors such as declining religious participation, cost considerations, and environmental concerns. While cremation has become the preferred option for many Americans due to its affordability, funeral homes are also exploring alternative approaches such as aquamation and human composting. Additionally, advocates are pushing for increased price transparency in the industry, with the possibility of funeral homes being required to publish their prices online. As the funeral industry navigates this changing landscape, it will need to adapt to meet the evolving needs and preferences of consumers.

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