CATEGORY

Payroll Outsourcing Services

Payroll services is the process of evaluating and generating payslips for employees based on attendance. Outsourcing payroll allows employers to concentrate on its core activities and helps to reduction or control of expenditure by avoiding the hiring of new staff and technology-driven cost. The report highlights the key trends, sourcing practices and suppliers in the market.

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December 14, 2022
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Payroll Outsourcing Services Industry Benchmarks


Savings Achieved

(in %)

The average annual savings achieved in Payroll Outsourcing Services category is 6.20%

Payment Terms

(in days)

The industry average payment terms in Payroll Outsourcing Services category for the current quarter is 45.0 days

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Category Strategy and Flexibility

Engagement Model

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Sourcing Process

Supplier Type

Pricing Model

Contract Length

SLAs/KPIs

Lead Time

Supplier Diversity

Targeted Savings

Risk Mitigation

Financial Risk

Sanctions

AMEs

Geopolitical Risk

Cost Optimization

Price per Unit Competitiveness

Specification Leanness

Minimum Order Quality

Payment Terms

Inventory Control

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    Payroll Outsourcing Services Suppliers


    7,562
    Total Suppliers
    289
    Diverse Suppliers
    38
    Normalized Supplier Rating
    Payroll Outsourcing Services Supplier

    Find the right-fit payroll outsourcing services supplier for your specific business needs and filter by location, industry, category, revenue, certifications, and more on Beroe LiVE.Ai™.

    Sample Supplier
    Company
    American Express Company
    Location
    Jackson, Mississipi
    Duns number
    3862211

    D&B SER Rating

    dnb logo

    Up to 3 months

    1 9
    6
    Low Risk High Risk

    The Supplier Evaluation Risk (SER) Rating is Dun & Bradstreet’s proprietary scoring system used to assess the probability that a business will seek relief from creditors or cease operations within the next 12 months. SER ratings range from 1 to 9, with 9 indicating the highest risk of failure. We’ve prepared an infographic to help business owners better understand what influences their SER Rating.

    Moody`s ESG Solution
    ESG Profile

    Company and Sector Performance
    42

    100
    Limited (1)
    ESG Perfomance (/100)
    Environment
    85
    Social
    31
    Governance
    48
    6 Domains Performance (/100)
    Business behaviour
    39
    Human rights
    47
    Community Environment
    26
    Corporate governance
    54
    Human resources
    21
    Security Scorecard
    90

    Threat indicators
    B
    83
    Network Security
    Detecting insecure network settings
    A
    100
    Hacker Chatter
    Monitoring hacker sites for chatter about your company
    A
    97
    DNS Health
    Detecting DNS insecure configuration and vulnerabilities
    B
    86
    Application Security
    Detecting common website application vulnerbilities
    B
    86
    Endpoint Security
    Detecting unprotected enpoints or entry points of user tools, such as desktops, laptops mobile devices, and virtual desktops
    A
    100
    Cubic Score
    Proprietary algorithms checking for implementation of common security best practices
    A
    98
    Patching Cadence
    Out of date company assets which may contain vulnerabilities of risk
    A
    100
    Social Engineering
    Measuring company awareness to a social engineering or phising attack
    A
    100
    IP Reputation
    Detecting suspecious activity, such as malware or spam, within your company network
    A
    100
    Information Leak
    Potentially confidential company information which may have been inadvertently leaked

    Industry Comparison
    amexglobalbusinesstravel.com
    Industry average
    Adverse Media Appearances
    Environmental Issues
    0
    Workforce Health Safety Issues
    0
    Product Service Issues
    12
    Human Rights Issues
    0
    Production Supply Chain Issues
    2
    Environmental Non Compliance Flags
    14
    Corruption Issues
    0
    Regulatory Non Compliance Flags
    26
    Fraud Issues
    3
    Labor Health Safety Flags
    3
    Regulatory Issues
    22
    Workforce Disputes
    0
    Sanctions
    1
    esg energy transition
    86
    Discrimination Workforce Rights Issues
    3
    esg controversies critical severity
    No

    Payroll Outsourcing Services market frequently asked questions


    Beroe's report provides an accurate update on the latest payroll outsourcing statistics. As per the report, the payroll services industry is expected to reach a market size of $10336 million by 2023 at a CAGR of 4.4%.

    The major contributors to the payroll services industry are North America and Europe with a market share of approximately 71%. Other emerging players are APAC and LATAM.

    Some of the latest trends in the payroll services industry are the emergence of factors such as political uncertainty and low crude oil prices affecting the industry. Key players such as North America and Europe have grown to hold considerable market size in the industry. Finally, payroll labor and non labor costs also contribute to the total cost of payroll services.

    The payroll services industry is expected to grow at a constant CAGR of 4.4%.

    Some of the global drivers of the payroll services industry are outsourcing that can offer cost saving options, better compliance with payroll legislations and growth of cloud-based payroll services. Furthermore, there's also an expected increase in the abilities of single vendors who can handle payroll across countries.

    Payroll Outsourcing Services market report transcript


    Payroll Outsourcing Services  Market Analysis and Global Outlook

    • The global payroll outsourcing market was estimated to be around $19 Bn by 2020 at a CAGR of 4.4% and is projected to reach $19.95 Mn by 2021, with a market growth at a CAGR of 4–5%.
    • Due to the impact of COVID-19, companies are planning to go for a single global provider with an MCPO sourcing model. Also, they are looking to consolidate the global payroll vendors.
    • North America continues to lead the payroll outsourcing services market over the forecast period owing to factors such as the utilization of business analytics, automated sub-processes, and big data along with the employment of mobility and cloud delivery models to governments.
    • Payroll outsourcing market maturity is lowest in the Middle East and Africa (MEA).
    • With the growing and emerging economies in APAC and Latin America, a high growth rate (approximately 7–11%) has been witnessed in these regions.

     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 Services  Global Industry Trends

    • 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%.
    • 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.
    • 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.
    • 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 Services  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.
    • International payroll outsourcing companies are focusing on creating reusable service delivery platforms with automation and scalability by employing innovative software solutions and tools for automatic deduction calculations, payment calculations, and record-keeping.

    Rising demand for MCPO 

    •  Increasing ability of single vendors to handle payroll across countries

    Better compliance

    • Outsourcing helps the buyer to stay updated with the changes in payroll regulatory legislations, especially in a global environment.

     Technological advantage

    • Governments' adoption of e-filings and digital services is driving the growth of cloud-based payroll services.

    Constraints 

    Market Consolidation

    • Low-cost competitiveness due to the presence of mature payroll service providers is challenging the profit growth of emerging industry players.

    Regulatory Pressure

    Constant regulatory changes to keep pace with the economic growth in APAC are hitting the profit margins of payroll outsourcing companies.

    COVID-19 Impact on Payroll Outsourcing Services Market

    The COVID-19 crisis has altered and challenged business operations in almost every way. Even the best-formed business continuity plans (BCP) are under-prepared to deal with the huge disturbance and ambiguity caused due to the public-health crisis.

    As such, companies worldwide are rethinking their strategies fast, while payroll and HR teams need to focus on keeping up with the evolving requirements to remain compliant, while assisting employees fit into a ‘new normal’ workspace.

    A recent survey has revealed that businesses that outsource their payroll functions find it easier to stay ahead of the curve and implement changes in rules and regulations.

    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.

     

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