The Global Market for Human Resource Outsourcing is Projected to Reach US$53.9 Billion by 2020

Focus on Cost Effective People Management Drives Adoption of Human Resource Outsourcing, According to a New Report by Global Industry Analysts, Inc.

GIA launches comprehensive analysis of industry segments, trends, growth drivers, market share, size and demand forecasts on the global Human Resource Outsourcing (HRO) market. The global market for Human Resource Outsourcing is projected to reach US$53.9 billion by 2020, driven by the growing need among enterprises to increase operational efficiency, reduce costs, streamline operations, and step up compliance management.

Human Resource Outsourcing (HRO) refers to the integrated operation and delivery of several HR processes, which are performed by a service provider on a contract basis. With mushrooming labor laws and employment regulations, businesses are expanding their outsourcing horizons to include complex, time-consuming activities like human resource administration. Organizations outsource various HR functions including payroll, employee management, employee benefits processing, and employee recruitment to service providers. Major factors driving the trend of HR outsourcing include cost efficiencies offered by outsourced HR services, and cutthroat competition among companies to reduce operational costs, enhance productivity and profitability. The market is also witnessing increased demand from developing countries and small and medium enterprises. Additionally, the need to align business operations with changing HR policy framework and employment legislation is driving growth in the market. With corporates looking beyond specialization in sourcing, vendors are increasingly adopting advanced processing methods and technologies such as analytics and cloud platforms. The growing service provider focus on technology innovation is benefiting the commercial success of cloud/BPaaS as a HRO service delivery model.

Payroll services and benefits administration are the most widely outsourced HR processes, given the fact that these processes are time consuming and pose significant compliance challenges. Also growing in popularity is outsourcing of other HR functions such as recruitment and learning. In the coming years, benefits administration is forecast to garner greater interest among enterprises especially in the healthcare sector, given the ongoing healthcare reforms in the United States. Another area with untapped potential for growth is Recruitment Process Outsourcing (RPO) and talent acquisition. In an era of talent shortages and skill gaps, recruiting is increasingly becoming an innovative and carefully constructed process requiring specialized sourcing expertise. Also, the need to cut back on costs incurred on recruitment staff favors the RPO market. Mid-market also presents enormous potential for growth, as a significant proportion of the business activity is emerging from mid-market companies. New deal signings and contract extensions are further expected to drive growth in the multi-process HRO (MPHRO) market.

As stated by the new market research report on Human Resource Outsourcing, the United States represents the largest market worldwide. Asia-Pacific is forecast to emerge as the fastest growing market with a CAGR of 8.1% over the analysis period, led by the presence of a large number of companies with geographically dispersed business operations, rising awareness among businesses about the potential benefits offered by HRO services, robust growth of Indian and Chinese markets, and rise in the number of contracts inked in the region. Payroll Services represents the largest service market in terms of revenue, driven by the growing enterprise focus on risk management, cost reduction, enhanced management control, business expansion, and compliance. Recruitment Process Outsourcing emerges as the fastest growing service category with a CAGR of 6.1% over the analysis period.

Major players covered in the report include Accenture Plc, Adecco S.A., Aon Hewitt LLC, Automatic Data Processing, Inc., Capita HR Solutions, Cielo, Inc., Ceridian HCM, Inc., CGI Group Inc., Empower Software Solutions, Inc., Fidelity Management and Research LLC, General Outsourcing Co, Ltd., Genesys, Hewlett-Packard Company, Infosys BPO Ltd. ,International Business Machines Corporation, Intuit, Inc., Mercer, LLC , NGA Human Resources, Paychex, Inc., Randstad Holding NV, Talx Corporation, Talent2 International Ltd., TriCore, Inc., Ultimate Software Group, Inc. , Xerox Corporation, among others.

The research report titled “Human Resource Outsourcing (HRO): A Global Strategic Business Report” announced by Global Industry Analysts Inc., provides a comprehensive review of market trends, growth drivers, product innovations and strategic industry activities of major companies worldwide. The report provides market estimates and projections for sales of Human Resource Outsourcing in US$ Million at the Service Provider’s levels for all major geographic markets- US, Canada, Europe (France, Germany, Italy, UK, and Rest of Europe), Asia-Pacific, and Rest of World. The market for Human Resource Outsourcing is also analyzed by service type - Benefits Administration Services, Payroll Services, Education & Training Services, Recruitment Process Outsourcing, and Other Services. 

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