[Research Report] The cloud based payroll software market is projected to grow from US$ 10,254.01 million in 2022 to US$ 20,355.22 million by 2028; it is estimated to register a CAGR of 12.1% from 2022 to 2028.
A payroll management system has increasingly become essential to operate and control employees' salaries, and a cloud-based payroll system is a massive support for organizations operating remotely, including the payroll department. Cloud-based payroll software collects, manages, and maintains employee data to automate employee payments remotely. Also, it helps businesses reduce their operational costs while staying aligned with the latest financial and legal obligations. Using cloud-based payroll software, employees' salaries can be disbursed from anywhere securely. Also, businesses can improve their efficiency by deploying new software with minimum risk and reduced internal staffing requirements. Owing to the cost-avoidance approach for managing payroll operations through effective governance structures and adopting leading practice processes and controls, the demand for cloud-based payroll software is growing significantly with the expansion of BFSI and IT & telecom industries. Many SMEs are expected to boost the demand for cloud-based payroll software in the coming years. Thus, the growing number of SMEs is projected to offer lucrative opportunities for the cloud based payroll software market in the future.
The cloud based payroll software market in North America is segmented into Canada, the US, and Mexico. The US accounted for the largest share of the North America cloud based payroll software market. Several businesses in the US are increasingly adopting advanced payroll solutions for workforce management. The use of outdated payroll systems such as spreadsheets has decreased with the rise in the popularity of automated payroll processes based on a centralized system. These processes help them keep up with compliance standards. Running payroll processes manually has been a cumbersome task for human resources (HR) departments. Also, specific rules have been levied for payroll and taxation in the US, depending upon the state of incorporation and business operation. Generally, workers tend to resign from a company if they experience issues with their paychecks. All these difficulties faced by HR departments can be addressed by cloud-based payroll software solutions. Companies in the cloud based payroll software market are taking several new initiatives to boost the demand for cloud-based payroll software. For instance, in September 2020, ProPay Software launched a new cloud-based program to provide business owners with a cloud-based HR assistant to help alleviate business management pains. The company also aims to make business activities such as payroll and employee tracking secure and accurate.
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Cloud Based Payroll Software Market: Strategic Insights
Market Size Value in US$ 10,254.01 million in 2022 Market Size Value by US$ 20,355.22 million by 2028 Growth rate CAGR of 12.1% from 2022 to 2028 Forecast Period 2022-2028 Base Year 2022
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Cloud Based Payroll Software Market: Strategic Insights
| Market Size Value in | US$ 10,254.01 million in 2022 |
| Market Size Value by | US$ 20,355.22 million by 2028 |
| Growth rate | CAGR of 12.1% from 2022 to 2028 |
| Forecast Period | 2022-2028 |
| Base Year | 2022 |
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Impact of COVID-19 Pandemic on Europe Cloud Based Payroll Software Market Growth
The COVID-19 pandemic had a diverse impact on various nations in Europe. Nations such as Italy and France witnessed increased cases, leading to stringent and long-term lockdowns and social isolation. The pandemic led to an increase in the need for advanced payroll systems that are accessible to employees working remotely, as processing payroll outside of the organization's IT systems and servers exposes the data to potential security breaches and hackers. Further, cloud-based payroll software addresses those limitations by securely allowing remote payroll data access, eliminating the need for payroll staff to be physically present in the office. Many cloud-based payroll software can also integrate other HR functions, such as time-tracking. Also, regular software updates ensure compliance with changes in employment laws and statutory contributions. This allows organizations to streamline standalone HR processes onto a unified HR platform, ensuring accurate and compliant payroll despite remote work arrangements. Hence, the COVID-19 pandemic supported the Europe cloud based payroll software market growth.
Lucrative Regions for Cloud Based Payroll Software Market
- Sample PDF showcases the content structure and the nature of the information with qualitative and quantitative analysis.
Market Insights – Cloud Based Payroll Software Market
- Sample PDF showcases the content structure and the nature of the information with qualitative and quantitative analysis.
Ease of System Enhancements and Updates to Drive Cloud Based Payroll Software Market Growth in Coming Years
Payroll should be managed efficiently, as inaccuracies in payroll calculation and processing might hamper employees' experience in the organization. Moreover, cloud-based payroll management software is generally easy to set up and execute timely updates. Employees can easily use this software, and the vendors also provide a training manual to understand the software. Since the software is easy to install and update, the implementation of this software grew significantly to ease the employees' work. As online payroll software is easy to use and helps navigate easily, payroll software vendors allow end users to pay as per business needs in terms of increasing or decreasing the number of users. Finance is a crucial resource for any organization, irrespective of its type, size, or industry. To implement proper payroll management, the rising demand for payroll software further accelerates the cloud based payroll software market growth.
Industry Vertical-Based Cloud Based Payroll Software Market Insights
Based on industry vertical, the cloud based payroll software market is segmented into BFSI, manufacturing, healthcare, telecom and IT, retail, hospitality, and others. The BFSI segment led the cloud-based payroll software market in 2021. BFSI is among the most significant revenue-generating verticals. In this sector, HR tools are used in resolving workplace disputes. Employees also use them to voice concerns and feedback anonymously. HR management systems, attendance, leave, and payroll management methods have changed significantly in the BFSI industry. Companies have already adopted different software and applications for managing employees' attendance and leaves. Moreover, companies in this industry use this data when calculating the payroll, which is generally a time-consuming task requiring HR executives to review payroll data, create salary accounts, process payroll, and generate pay slips for employees. All these factors have led the BFSI segment growth in the cloud based payroll software market.
Players operating in the cloud based payroll software market mainly adopt inorganic growth strategies to stay competitive in the cloud based payroll software market ecosystem.
- In December 2022, Xero Ltd launched single payroll, single touch payroll phase 2 in the market. This will be used in the business to build on its existing STP reporting and share more information with the ATO and other government agencies.
- In October 2022, ELMO Software, a cloud HR and payroll solutions company, partnered with Wellington Phoenix. This partnership aimed at improving HR and payroll management for the club through the use of ELMO's cloud HR and payroll solutions and increased visibility and brand recognition for ELMO Software.
Company Profiled
- Sage Group Plc
- Moorepay Ltd
- Automatic Data Processing Inc
- Xero Ltd
- Ceridian HCM Holdings Inc
- MYOB Australia Pty Ltd
- Microkeeper Ltd
- ELMO Software Ltd
- Webscale Pty Ltd
- Talenox Pte Ltd
Report Coverage
Revenue forecast, Company Analysis, Industry landscape, Growth factors, and Trends
Segment Covered
Component, Organization Size, and Industry Vertical
Regional Scope
North America, Europe, Asia Pacific, Middle East & Africa, South & Central America
Country Scope
Argentina, Australia, Brazil, Canada, France, Germany, Italy, Malaysia, Mexico, New Zealand, Saudi Arabia, Singapore, South Africa, South Korea, UAE, United Kingdom, United States
Frequently Asked Questions
Owing to the cost-avoidance approach for managing payroll operations through effective governance structures and adopting leading practice processes and controls, demand for cloud-based payroll software is growing significantly with the expansion of the BFSI and IT & telecom industry. Cloud-based payroll systems allow easy setup of new clients and employees to the payroll systems and make it easy to organize and customize workflows as business needs change, which drives the cloud-based payroll software market growth.
The software alerts enterprises about future tax deadlines and protects organizations from costly litigation and fines by calculating tax. Many SMEs are expected to boost the demand for cloud-based payroll software in the coming years, mainly for tax calculations. Thus, the growing number of SMEs is projected to offer lucrative opportunities for the cloud-based payroll software market in the future.
North America held the largest share of the global cloud-based payroll software market in 2021. Businesses in the region are adopting technology solutions enabling their employees to work from home. There is a rapid digital transformation of organizations in their internal operations and customer and supply chain interactions. Investments in technology are no longer driven merely by the need to obtain cost efficiencies. They are increasingly considered as a strategic requirement for business success. All these factors are expected to propel the market growth in the region during the forecast period.
Many activities across the payroll process are routine and reoccurring with large amounts of data, like the data reconciliation process that occurred at different times before. AI technology provide insight and analytics to support overall labor management decisions, solving problems by looking at large amounts of data and acting based on those predictions. Therefore, the emergence of AI-powered payroll solutions is expected to become a major trend in the market during the forecast period.
The Sage Group plc; Moorepay Limited; Automatic Data Processing, Inc.; Xero Limited; Ceridian HCM, Inc; MYOB Australia Pty Ltd; Microkeeper; ELMO Software; Webscale Pty Ltd; and Telenox Pte Ltd. are the leading companies in the cloud-based payroll software market.
The List of Companies - Cloud Based Payroll Software Market
- The Sage Group plc
- Moorepay Limited
- Automatic Data Processing, Inc.
- Xero Limited
- Ceridian HCM, Inc
- MYOB Australia Pty Ltd
- Microkeeper
- ELMO Software
- Webscale Pty Ltd
- Telenox Pte Ltd.
The Insight Partners performs research in 4 major stages: Data Collection & Secondary Research, Primary Research, Data Analysis and Data Triangulation & Final Review.
- Data Collection and Secondary Research:
As a market research and consulting firm operating from a decade, we have published many reports and advised several clients across the globe. First step for any study will start with an assessment of currently available data and insights from existing reports. Further, historical and current market information is collected from Investor Presentations, Annual Reports, SEC Filings, etc., and other information related to company’s performance and market positioning are gathered from Paid Databases (Factiva, Hoovers, and Reuters) and various other publications available in public domain.
Several associations trade associates, technical forums, institutes, societies and organizations are accessed to gain technical as well as market related insights through their publications such as research papers, blogs and press releases related to the studies are referred to get cues about the market. Further, white papers, journals, magazines, and other news articles published in the last 3 years are scrutinized and analyzed to understand the current market trends.
- Primary Research:
The primarily interview analysis comprise of data obtained from industry participants interview and answers to survey questions gathered by in-house primary team.
For primary research, interviews are conducted with industry experts/CEOs/Marketing Managers/Sales Managers/VPs/Subject Matter Experts from both demand and supply side to get a 360-degree view of the market. The primary team conducts several interviews based on the complexity of the markets to understand the various market trends and dynamics which makes research more credible and precise.
A typical research interview fulfils the following functions:
- Provides first-hand information on the market size, market trends, growth trends, competitive landscape, and outlook
- Validates and strengthens in-house secondary research findings
- Develops the analysis team’s expertise and market understanding
Primary research involves email interactions and telephone interviews for each market, category, segment, and sub-segment across geographies. The participants who typically take part in such a process include, but are not limited to:
- Industry participants: VPs, business development managers, market intelligence managers and national sales managers
- Outside experts: Valuation experts, research analysts and key opinion leaders specializing in the electronics and semiconductor industry.
Below is the breakup of our primary respondents by company, designation, and region:
Once we receive the confirmation from primary research sources or primary respondents, we finalize the base year market estimation and forecast the data as per the macroeconomic and microeconomic factors assessed during data collection.
- Data Analysis:
Once data is validated through both secondary as well as primary respondents, we finalize the market estimations by hypothesis formulation and factor analysis at regional and country level.
- 3.1 Macro-Economic Factor Analysis:
We analyse macroeconomic indicators such the gross domestic product (GDP), increase in the demand for goods and services across industries, technological advancement, regional economic growth, governmental policies, the influence of COVID-19, PEST analysis, and other aspects. This analysis aids in setting benchmarks for various nations/regions and approximating market splits. Additionally, the general trend of the aforementioned components aid in determining the market's development possibilities.
- 3.2 Country Level Data:
Various factors that are especially aligned to the country are taken into account to determine the market size for a certain area and country, including the presence of vendors, such as headquarters and offices, the country's GDP, demand patterns, and industry growth. To comprehend the market dynamics for the nation, a number of growth variables, inhibitors, application areas, and current market trends are researched. The aforementioned elements aid in determining the country's overall market's growth potential.
- 3.3 Company Profile:
The “Table of Contents” is formulated by listing and analyzing more than 25 - 30 companies operating in the market ecosystem across geographies. However, we profile only 10 companies as a standard practice in our syndicate reports. These 10 companies comprise leading, emerging, and regional players. Nonetheless, our analysis is not restricted to the 10 listed companies, we also analyze other companies present in the market to develop a holistic view and understand the prevailing trends. The “Company Profiles” section in the report covers key facts, business description, products & services, financial information, SWOT analysis, and key developments. The financial information presented is extracted from the annual reports and official documents of the publicly listed companies. Upon collecting the information for the sections of respective companies, we verify them via various primary sources and then compile the data in respective company profiles. The company level information helps us in deriving the base number as well as in forecasting the market size.
- 3.4 Developing Base Number:
Aggregation of sales statistics (2020-2022) and macro-economic factor, and other secondary and primary research insights are utilized to arrive at base number and related market shares for 2022. The data gaps are identified in this step and relevant market data is analyzed, collected from paid primary interviews or databases. On finalizing the base year market size, forecasts are developed on the basis of macro-economic, industry and market growth factors and company level analysis.
- Data Triangulation and Final Review:
The market findings and base year market size calculations are validated from supply as well as demand side. Demand side validations are based on macro-economic factor analysis and benchmarks for respective regions and countries. In case of supply side validations, revenues of major companies are estimated (in case not available) based on industry benchmark, approximate number of employees, product portfolio, and primary interviews revenues are gathered. Further revenue from target product/service segment is assessed to avoid overshooting of market statistics. In case of heavy deviations between supply and demand side values, all thes steps are repeated to achieve synchronization.
We follow an iterative model, wherein we share our research findings with Subject Matter Experts (SME’s) and Key Opinion Leaders (KOLs) until consensus view of the market is not formulated – this model negates any drastic deviation in the opinions of experts. Only validated and universally acceptable research findings are quoted in our reports.
We have important check points that we use to validate our research findings – which we call – data triangulation, where we validate the information, we generate from secondary sources with primary interviews and then we re-validate with our internal data bases and Subject matter experts. This comprehensive model enables us to deliver high quality, reliable data in shortest possible time.
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