New York, United States, April 05, 2022 (GLOBE NEWSWIRE) -- The global professional employer organization market had a market share of USD 41,997.4 million in 2017, according to a new report of StraitsResearch. It is predicted to increase at a CAGR of 11.10% from 2017 to 2030.
A Professional Employer Organization (PEO) is an outsourcing organization that helps businesses in their daily operations, and many even provide recruitment services to the businesses. A PEO's standard operations are administration, payroll, taxation, risk management, talent management, etc. The association can buy administrations from a PEO and assist businesses with decreasing the expense of regulating their business operations.
Many entrepreneurs outsource their HR and payroll functions to PEO companies to focus more on their business growth. The PEO Market is relied upon to develop quickly given the consistent turn of events and development of small and medium-sized enterprises (SMEs) worldwide. These SMEs form 95% of the existing organizations around the globe and generate around 60%–70% of job opportunities contributing to the overall economic growth.
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Key Insights
- Based on type, the market is categorized into full-service PEO and ASO. ASO grabbed a relatively minor market share than full-service SEO in 2021, but it is predicted to grow at a higher CAGR of 13.74%.
- By End-User, the market is segmented into small, medium, and large businesses. The large businesses acquired ~50% of the market in 2021. It is expected to grow at a CAGR of 8.77%.
- Geographically, the market is divided into North America, Europe, Asia-Pacific, Latin America, and the Middle East and Africa. North America and Europe are the primary markets for PEO services.
Rising Demand for PEO Services in the Wake of the Changing Employer Outlook
A Professional Employer Organization (PEO) is a staffing arrangement firm that gives businesses adaptable and custom-made administration support. The idea of a PEO is comparatively fresh and is gradually becoming prominent. The demand for conventional departments for employment is slowly decreasing, and the outsourcing option is much more cost-effective, efficient, and flexible.
The essential variable affecting the development of the PEO market is the requirement for organizations to follow work regulations, which have been expanding throughout recent years. Many enormous organizations have a high turnover pace of workers, prompting extra expenses, for instance, the cost associated with recruiting new employees. These organizations offer different types of expert assistance to their clients, including representative advantages and finance, which are comparatively error-free and efficient.
Employers are becoming progressively mindful of purchasing these services from the expert organization—the standard choices to reduce regulatory expenses, employee engagement, and retention and limit turnover losing value.
For the smooth functioning of the organization, monitoring, evaluating, and tracking data has become essential. Many advancements in technology like automated systems to manage employee data have risen to prominence to oversee HR operations. Quite possibly the main pattern worldwide. One of the expanding interests in the PEO industry is the automated technological systems to monitor the process of payroll administration.
As of late, the interest in these associations has expanded. The high turnover pace of representatives prompts a significant expense to the association. Further, there is an expansion in selecting costs, including the preparation cost. Under these conditions, PEOs offer different types of assistance to their clients, including representative advantages and financial advantages.
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Impact of COVID-19
The pandemic negatively impacted all the nations around the world. Various guidelines and protocols forced businesses to halt their production. The yearly production count went down drastically. This led to the financial crisis due to a lack of funds. There rose a need to curb the extra expenses and risks efficiently. This brought PEOs into the picture. Hence the PEO market was not affected to that extent.
PEOs were proactive in assisting clients with the application cycle for financial boosts and presented new arrangements even during the pandemic. So 2020 and 2022 recorded solid performances of these organizations. The PEO model is situated to gain the inborn scale advantages of being the country's biggest PEO. The dangers of this model are the intrinsic unpredictability of protection claims and the potential for an extended decline in the SMB market.
Various key players in these businesses have helped each other recover through mergers, acquisitions, strategic partnerships, new product launches, etc. This is substantially led to the recovery losses in that period and increased the demand for these services. The creation of new job vacancies and growing numbers of small businesses are the other two factors that expanded the market for these firms after COVID–19.
Global Professional Employer Organization Market: Segmentation
By Type
- Full Service PEO
- ASO
By End-User
- Small Businesses
- Medium Businesses
- Large Businesses
Regions Covered
- North America
- Europe
- Asia-Pacific
- Latin America
- The Middle East and Africa
List of Key Players
- Paychex Inc.
- ADP LLC.
- TriNet Group Inc.
- Global PEO Services
- Infostride
- Co Advantage
- Frankcrum
Market News
- January 2022 – Paychex announced a team-up with HireRight to Offer COVID-19 rapid test kits to support businesses managing workplace testing for employees.
- November 2021 – announced the acquisition of Integrated Design, Inc., strengthening its robust HCM and Workforce Management Solutions capabilities.
- October 2021 – announced the acquisition of Flock, a benefits administration software company. This acquisition will provide cutting-edge benefits administration software that aligns with the company's commitment to driving innovation and providing a suite of digital services.
- October 2021 – INFINITI HR announced a partnership with Tortal Training, increased the need to make effective training easy, and developed interactive eLearning solutions.
- February 2021 – Insperity Inc announced a collaboration with Salesforce, a global leader in CRM, to digitally transform its business. The advantages of this strategic collaboration include increased marketing campaigns, improved customer acquisition and retention, and increased productivity.
- November 2020 – TriNet announced a launch of a Mobile App to simplify open enrollment for an increasingly dispersed SMB workforce that features giving the user greater flexibility to manage TriNet-sponsored benefits and flexible spending account claims and improved account security.
- April 2020 – INFINITI HR announced a joint venture with Quad M Solutions, Inc. (PrimeAxess Inc.), and they will form two subsidiaries: OpenAxess Inc. and PrimeAxess Inc.
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Detailed Table of Content
1 Introduction
1.1 Market Definition
1.2 Market Scope
2 Research Methodology
2.1 Primary Research
2.2 Research Methodology
2.3 Assumptions & Exclusions
2.4 Secondary Data Sources
3 Market Overview
3.1 Report Segmentation & Scope
3.2 Value Chain Analysis: Professional Employer Organization (PEO) Market
3.3 Key Market Trends
3.3.1 Drivers
3.3.2 Restraints
3.3.3 Opportunities
3.4 Porter’s Five Forces Analysis
3.4.1 Bargaining Power of Suppliers
3.4.2 Bargaining Power of Buyers
3.4.3 Threat of Substitution
3.4.4 Threat of New Entrants
3.4.5 Competitive Rivalry
3.5 Market Share Analysis
3.6 Impact of COVID-19 on Professional Employer Organization (PEO)
4 ComponentOverview
4.1 Introduction
4.1.1 Market Size & Forecast, 2017–2029 (USD Million)
4.2 Solution
4.2.1 Payroll Management
4.2.1.1 Market Size & Forecast, 2017–2029 (USD Million)
4.2.2 Workforce Management
4.2.2.1 Market Size & Forecast, 2017–2029 (USD Million)
4.2.3 Benefits & Tax Administration
4.2.3.1 Market Size & Forecast, 2017–2029 (USD Million)
4.2.4 Talent Management
4.2.4.1 Market Size & Forecast, 2017–2029 (USD Million)
4.2.5 Compliance Services
4.2.5.1 Market Size & Forecast, 2017–2029 (USD Million)
4.2.6 Employment Screening Solution
4.2.6.1 Market Size & Forecast, 2017–2029 (USD Million)
4.2.7 Others
4.2.7.1 Market Size & Forecast, 2017–2029 (USD Million)
4.3 Services
4.3.1 Market Size & Forecast, 2017–2029 (USD Million)
5 Deployment ModeOverview
5.1 Introduction
5.1.1 Market Size & Forecast, 2017–2029 (USD Million)
5.2 Cloud
5.2.1 Market Size & Forecast, 2017–2029 (USD Million)
5.3 On-Premise
5.3.1 Market Size & Forecast, 2017–2029 (USD Million)
6 Organization Size Overview
6.1 Introduction
6.1.1 Market Size & Forecast, 2017–2029 (USD Million)
6.2 SMEs
6.2.1 Market Size & Forecast, 2017–2029 (USD Million)
6.3 Large Enterprises
6.3.1 Market Size & Forecast, 2017–2029 (USD Million)
7 Vertical Overview
7.1 Introduction
7.1.1 Market Size & Forecast, 2017–2029 (USD Million)
7.2 IT & Telecom
7.2.1 Market Size & Forecast, 2017–2029 (USD Million)
7.3 BFSI
7.3.1 Market Size & Forecast, 2017–2029 (USD Million)
7.4 Manufacturing & retail
7.4.1 Market Size & Forecast, 2017–2029 (USD Million)
7.5 Professional Services
7.5.1 Market Size & Forecast, 2017–2029 (USD Million)
7.6 Construction & Industrial Engineering Sector
7.6.1 Market Size & Forecast, 2017–2029 (USD Million)
7.7 Others
7.7.1 Market Size & Forecast, 2017–2029 (USD Million)
8 Regional Analysis
8.1 Introduction
8.1.1 Market Size & Forecast, 2017–2029 (USD Million)
8.2 North America
8.2.1 Market Size & Forecast, 2017–2029 (USD Million)
8.2.2 The U.S.
8.2.3 Canada
8.2.4 Mexico
8.3 Europe
8.3.1 Market Size & Forecast, 2017–2029 (USD Million)
8.3.2 Germany
8.3.3 France
8.3.4 The U.K.
8.3.5 Italy
8.3.6 Spain
8.3.7 Benelux
8.3.8 Russia
8.3.9 NORDIC
8.3.10 The Rest of Europe
8.4 Asia-Pacific
8.4.1 Market Size & Forecast, 2017–2029 (USD Million)
8.4.2 Japan
8.4.3 China
8.4.4 Australia
8.4.5 India
8.4.6 South Korea
8.4.7ASEAN-6
8.4.8 The Rest of Asia-Pacific
8.5 MEA
8.5.1 Market Size & Forecast, 2017–2029 (USD Million)
8.5.2 Saudi Arabia
8.5.3 South Africa
8.5.4 UAE
8.5.5 Egypt
8.5.6 The Rest of MEA
8.6 South America
8.6.1 Market Size & Forecast, 2017–2029 (USD Million)
8.6.2 Brazil
8.6.3 Argentina
8.6.4 Chile
8.6.5 Peru
8.6.6 The Rest of South America
9 Company Profile
9.1 Automatic Data Processing (ADP)
9.1.1 Company Overview
9.1.2 Financial Performance
9.1.3 Recent Developments
9.1.4 Product Portfolio
9.2 Insperity
9.2.1 Company Overview
9.4.2 Financial Performance
9.2.3 Recent Developments
9.2.4 Product Portfolio
9.3 TriNet Group, Inc
9.3.1 Company Overview
9.3.2 Financial Performance
9.3.3 Recent Developments
9.3.4 Product Portfolio
9.4 Paychex Inc
9.4.1 Company Overview
9.4.2 Financial Performance
9.4.3 Recent Developments
9.4.4 Product Portfolio
9.5 Total Leasing Company, Inc
9.5.1 Company Overview
9.5.2 Financial Performance
9.5.3 Recent Developments
9.5.4 Product Portfolio
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News Media
Rising Demand for PEO Services in the Wake of the Changing Employer Outlook
ADP, Trinet, Insperity, and CoAdvantage are among the Market Leaders in the PEO Market
Top 5 Smart Workplace Technology Trends
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