First Research US Industry Profile

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Payroll Services
SIC Codes: 8721
NAICS Codes: 541214
Last Quarterly Update: 3/4/2019
Companies in this industry generate paychecks, payroll reports, and tax filings for clients. Major companies include ADP, Ceridian, Insperity, and Paychex, all based in the US, as well as Canada's Nethris (a part of Groupe CGI), Brazil's Populis Serviços, and India's Neeyamo.
The US is the world's primary market for payroll services. Global growth in the industry is driven by workforce expansion and by the adoption of more complex payroll processes that incorporate cloud-based software and aspects of other HR services, according to IHS. Countries such as Argentina, Brazil, Canada, Chile, and Mexico are increasingly adopting payroll services for public sector projects due to their proximity to the US, according to Technavio. India is a major growth market for the industry.
The US payroll services industry includes about 5,900 establishments (single-location companies and units of multi-location companies) that generate annual revenue of about $30 billion.
Professional employer organizations (PEOs), which may also provide payroll services, are covered further in a separate industry profile.
Competitive Landscape
Demand for payroll services is driven by employment. The profitability of individual companies depends on efficient use of information technology and effective marketing. Large companies can better compete for business from customers who operate from multiple locations. Small companies can compete by serving local or regional markets. The US industry is concentrated: the 50 largest companies account for more than 70% of industry revenue; the four largest companies account for about 50%.
Companies in this industry may compete with other providers of outsourced human resources (HR) management services, including professional employer organizations (PEOs), business process outsourcing (BPO) firms, or financial institutions. Companies may also compete with organizations that have in-house payroll services, typically conducted through their accounting or HR departments.
Products, Operations & Technology
Payroll services companies collect employee information, such as wages, hours worked, deductions, and other compensation-related data, then process it ... plus:
Sales & Marketing
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Finance & Regulation
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Regional & International Issues
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Human Resources
Also includes the following chapters:
Quarterly Industry Update
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Industry Indicators
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Business Challenges
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Trends and Opportunities
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Call Preparation Questions
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Financial Information
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Industry Forecast
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Industry Websites
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Glossary of Acronyms

Historical Profiles (PDF format)

11/26/2018
08/27/2018
05/28/2018
02/26/2018
11/20/2017
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02/20/2017
11/14/2016
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08/25/2014
06/02/2014
03/10/2014
12/02/2013
09/09/2013
06/17/2013
03/25/2013
12/17/2012
09/24/2012
07/09/2012
04/16/2012
12/19/2011
09/26/2011
06/13/2011
03/14/2011