Payroll Outsourcing Global Market Report 2024

The payroll outsourcing market size has grown strongly in recent years. It will grow from $11.17 billion in 2023 to $12.01 billion in 2024 at a compound annual growth rate (CAGR) of 7.5%. The growth observed in the historical period can be attributed to an increased focus on improving efficiency, a heightened demand for reducing operational costs, growth in the IT sector, industrialization, and expansion in the manufacturing sector.

The payroll outsourcing market size is expected to see strong growth in the next few years. It will grow to $16.12 billion in 2028 at a compound annual growth rate (CAGR) of 7.6%. The anticipated growth in the forecast period can be attributed to a rise in demand for cloud-based payroll services, an increasing need to eliminate the requirement for hiring technical staff for payroll services, the penetration of e-commerce platforms, growth in the banking, financial services, and insurance (BFSI) sectors, and an increasing number of small to medium enterprises (SMEs). Key trends expected in the forecast period include the adoption of artificial intelligence and automation in payroll outsourcing services, the launch of next-generation technologies, the introduction of subscription-based services, and the integration of automation into the process.

The payroll outsourcing market is poised for growth, driven by an increasing demand for cloud-based payroll solutions. Cloud-based payroll allows users to manage payroll processes online, offering improved accessibility, enhanced communication between customers and service providers, and scalable and cost-effective options. For example, in 2023, Alight Solutions reports that 40% of businesses plan to update their payroll systems, with cloud-based solutions dominating payroll delivery platforms (61%) over on-premises (39%). A substantial portion of businesses (26%) has already made strides in digital payroll efforts, and a majority (62%) anticipates undergoing digital transitions in the next two years. Hence, the surge in demand for cloud-based payroll is a driving force for the payroll outsourcing market.

The growth of employment is another factor propelling the expansion of the payroll outsourcing market. Employment, representing engagement in paid work, is marked by individuals contributing their skills and time to an employer in exchange for compensation. The increase in employment creates a demand for sophisticated and scalable payroll solutions, making payroll outsourcing an attractive option for businesses handling larger workforces. According to the U.S. Bureau of Labor Statistics in December 2022, 69.8% of individuals were employed full time throughout 2021, indicating a rise from 63.1% in 2020. Growing employment is a significant driver for the growth of the payroll outsourcing market.

Innovations in products are emerging as a prominent trend in the payroll outsourcing market, with major companies focusing on creating innovative solutions to fortify their market position. For instance, Payroll Growth Partners (PGP), a UK-based provider of payroll management services, introduced Next-Gen Payroll products in June 2023. These innovative payroll services, available to employees using PayBridge's platform, include features such as pay cards, real-time payroll, and early access to pay.

Major companies in the payroll outsourcing market are introducing new solutions, such as cloud technology, to enhance their profitability. Cloud technology in payroll outsourcing offers a modern, flexible, and efficient approach to managing payroll processes. Immedis, an Ireland-based payroll solution provider, launched One View in November 2022. This platform replaces manual processes with a secure and efficient system, providing real-time reporting and analytics on a global scale. With a commitment to innovation, One View empowers users to access curated analytics and tailor payroll processes based on individual country needs.

In November 2021, Payroll Software and Services Group Ltd. (PSSG), a UK-based software and outsourcing solutions company, acquired Just Payroll Services Ltd. for an undisclosed amount. Through this acquisition, PSSG aims to enhance visibility over payroll, improve efficiency, and increase productivity. Just Payroll Services Ltd., a UK-based payroll services company, specializes in outsourced payroll management services for the UK and abroad.

Major companies operating in the payroll outsourcing market report are Accenture plc., The International Business Machines Corporation, Deloitte & Touche LLP, KPMG International Limited, Block Inc., Automatic Data Processing Inc., Infosys Limited, Intuit Inc., CGI Group Inc., Xerox Corporation, Insperity Inc., Workday Inc., TriNet Group Inc., Paychex Inc., Sage Group plc., Heartland Payment Systems Inc., Ceridian HCM Inc., Justworks Inc., Paycor HCM Inc., Gusto Inc., PrimePay LLC, Zenefits, Zalaris ASA, Netchex Inc., Wagepoint Inc., MyPayrollHR, PEO Canada, SurePayroll Inc., Vision HR Inc., Fuse Workforce Management.

North America was the largest region in the payroll outsourcing market in 2023. The regions covered in the payroll outsourcing market report are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East, Africa. The countries covered in the payroll outsourcing market report are Australia, Brazil, China, France, Germany, India, Indonesia, Japan, Russia, South Korea, UK, USA, Italy, Spain, Canada.

The primary types of payroll outsourcing are fully-managed outsourcing and co-managed outsourcing. In fully-managed outsourcing, the service provider oversees the entire process from start to finish, reducing the need for businesses to invest significant time, effort, or attention. This approach is applicable across various business sizes, including small, medium, and large enterprises, and is utilized by diverse industries such as banking, financial services and insurance (BFSI), consumer and industrial products, information technology (IT) and telecommunications, the public sector, healthcare, and other end-users.

The payroll outsourcing research report is one of a series of new reports that provides payroll outsourcing market statistics, including the payroll outsourcing industry's global market size, regional shares, competitors with payroll outsourcing market share, detailed payroll outsourcing market segments, market trends and opportunities, and any further data you may need to thrive in the payroll outsourcing industry. This payroll outsourcing market research report delivers a complete perspective of everything you need, with an in-depth analysis of the current and future scenarios of the industry.

The payroll outsourcing market includes revenues earned by entities through the administration of employee benefits, tax withholding, wage computation and salary management, and computing statutory leaves. The market value includes the value of related goods sold by the service provider or included within the service offering. Only goods and services traded between entities or sold to end consumers are included.

The market value is defined as the revenues that enterprises gain from the sale of goods and/or services within the specified market and geography through sales, grants, or donations in terms of the currency (in USD, unless otherwise specified).


The revenues for a specified geography are consumption values that are revenues generated by organizations in the specified geography within the market, irrespective of where they are produced. It does not include revenues from resales along the supply chain, either further along the supply chain or as part of other products.


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