Payroll Outsourcing Market Overview
The global market for payroll outsourcing is estimated to reach $10336 million by 2023 while growing at a constant CAGR of 4.4 percent. The market growth is uniform across all regions, with the maximum growth coming from multi-country payroll contracts. The multi-country payroll market is growing three times the rate of overall market and represents 15 percent of the entire standalone payroll services revenue. North America and Europe are the most dominant payroll markets and account for a major portion of the global deal activity. APAC and LATAM are also emerging payroll outsourcing markets.
Cloud-based systems are expected to introduce new opportunities within the global payroll sphere as that would make it easier to align payroll and HR internationally. The report also provides Brexit's impact on payroll outsourcing, along with a study of different impact areas. It also outlines the major industry trends prevalent in the industry, along with major drivers and constraints. It also provides an industrial market outlook in areas such as North America, Europe, Middle East, Africa, APAC, and LATAM. It also explores the various opportunities and challenges influencing payroll outsourcing, followed by Porter's five forces analysis on emerging and developed markets.
Beroe gathers intelligence through primary sources that include industry experts, researchers, and consultants, as well as current suppliers, producers and distributors. Secondary sources can include business journals, newsletters, magazines, market research data, company sources, and industry associations. Following data collation, analysis, and strategic review, the Final Research Report is published on Beroe LiVE.
Payroll Outsourcing Market Trends
Category Intelligence on Payroll Outsourcing covers the following
- Information relating to market, supply, cost, and pricing analysis
- Hard to find data on cost and TCO models, supplier details, and performance benchmarks
- Macroeconomic and regional trends impacting cost, supply, and other market dynamics
- Category-specific negotiation and sourcing advice
Industry Outlook & Drivers
Payroll Outsourcing Market Analysis and Global Outlook
The global payroll outsourcing market was worth $16.4 billion in 2015, and it is estimated to be around $17.4 billion in 2016
- The payroll outsourcing market size is expected to continue a healthy growth rate of around 5–7 percent to reach around $22 billion by 2020
- Factors, like political uncertainty and the low crude oil prices, which could affect business in the Middle East, are likely to impact the payroll outsourcing trends
- North America and Europe with a payroll outsourcing market share of approximately 71 percent are the major contributors to the market.
- Payroll labor and non-labor costs account for 70–80 percent of the total cost of payroll outsourcing services.
- High-maturity regions in the global payroll outsourcing market (Established service providers, providing outsourced payroll services for more than 20 years) include countries like the United States and Western Europe.
Payroll Outsourcing Global Market Maturity
Payroll outsourcing market maturity is lowest in the Middle East and Africa.
- With the growing and emerging economies in APAC and Latin America, a high growth rate (approximately 7–11 percent) has been witnessed in these regions
Payroll Outsourcing Global Industry Trends
Bundled payroll services have become a market trend due to the increasing market maturity of payroll outsourcing services.
- With the increasing demand for cost reduction and time efficiency by the MNCs, MCPO has emerged as a trend, growing at a rate of approximately 20 percent.
- Buyers' increasing interest in self-service platforms, which leads to easier access to employee data and thus better employee satisfaction, is driving the growth of technology adoption.
- Regions such as Latin America and APAC perceive the adoption of cloud-based services as a way to leap ahead of their competitors on technological grounds.
- Global payroll trends include Bundling Payroll Services, Multi-Country Payroll Outsourcing (MCPO), Process Automation and Adoption of Cloud-Based Services.
- Countries like Poland, Turkey, Switzerland, Portugal, Germany, Argentina and Mexico show more than 10% bi-annual change in the global payroll outsourcing complexity index.
- Market challenges include: Low cost competitiveness because of the presence of mature payroll service providers and constant regulatory changes that are meant to keep pace with the economic growth in the APAC region.
- Outsourcing payroll can reduce expenses by approximately 20 percent.
- Companies processing payroll in-house due to the risk of compromising confidential data, are being offered partial/hybrid payroll solutions by suppliers.
- The cost components of the payroll industry include the system costs, payroll labor and non-labor costs and payroll maintenance costs.
Payroll Outsourcing Global Drivers
Cost savings (above 20 percent)
- Outsourcing payroll leads to the reduction or control of expenditure by avoiding the hiring of new staff and technology-driven cost.
Rising demand for MCPO
- Increasing ability of single vendors to handle payroll across countries
- Outsourcing helps the buyer to stay updated with the changes in payroll regulatory legislations, especially in a global environment.
- Governments' adoption of e-filings and digital services is driving the growth of cloud-based payroll services.
Why You Should Buy This Report
- The report gives details on key global suppliers like Workday, ADP, NGA Human Resources, etc. including a detailed SWOT analysis.
It provides information on the payroll outsourcing market size and Porter’s five force analysis on the developed and emerging markets.
It lists out the key drivers and constraints of the global payroll outsourcing industry.