Up through the mid 1990s, while employed at the USGS, I used to consult an annual paper book on the size of GIS to answer this question. Back then, it was a modest sized community of government, academia, nonprofit, and industry who were involved with producing, serving, and using geospatial data, software, and services. But since then we have seen an explosion of geospatial technologies and data surround us in many forms and on many devices, and an expansion of users far beyond the traditional sciences and planning "core" into business, health, and just about every industry that exists. This makes answering the question increasingly difficult. It might be akin to "what is the size of the chemical, transportation, or <you fill in the blank" industries?" All are enormous and have fuzzy boundaries.
Nevertheless, a few documents are helpful in at least getting an estimate of the size of the geospatial industry. Geospatial World reported in their December 2013 issue on page 18 and following that the global geospatial industry brings in $270 billion in annual revenue, and companies in the sector pay more than $90 billion in wages each year. This stemmed from a report published by Oxera in January 2013. Equally interesting are the figures of how much travel time is saved annually due to geospatial technology (1.1 billion) and petrol saved (3.5 billion liters). According to the Oxera report, this means that geospatial is 5 to 10 times larger than the video game industry, and at least one third the size of the global airline industry. Geospatial is so large because "digital imagery and location-based services are essential components in resource management, supply chain logistics, infrastructure design, telecommunications, and national defense. Also consider the manufacturing industry involved with creating consumer products, as well as the satellite and space industry needed to make it all work." Additionally, Geospatial World author Sanjay wrote this article about the business value and the major technology and solution companies. Finally, Daratech has researched and published comprehensive surveys of the size of the geospatial industry.
One way of getting a sense of the size and diversity of the geospatial industry is to visit the Exhibit Hall at the Esri International User Conference. I am amazed at what I see there each year. Another way is to visit http://www.esri.com/industries.
No matter what the size of the geospatial industry, one thing is clear: Geospatial technology is here to stay. As our world faces more complex and interconnected issues in this century that increasingly impact our everyday lives, the "where" questions will be increasingly asked. And the technology to answer those questions will be GIS.