GVR Report cover HR Analytics Market Size, Share & Trends Report

HR Analytics Market Size, Share & Trends Analysis Report By Solution, By Service, By Deployment, By Enterprise Size, By End-use, By Region, And Segment Forecasts, 2022 - 2030

  • Report ID: GVR-4-68038-242-6
  • Number of Pages: 120
  • Format: Electronic (PDF)
  • Historical Range: 2017 - 2020
  • Industry: Technology

Report Overview

The global HR analytics market size was valued at USD 2.7 billion in 2021 and is expected to expand at a compound annual growth rate (CAGR) of 14.3% from 2022 to 2030. The growing need to efficiently use human resources, reduce operational costs in an organization, and gain real insights into employee behaviors is a key factor driving the market. Despite the fact that the COVID-19 pandemic has changed the business landscape, the use of HR analytics solutions to make data-driven decisions has become critical for monitoring and measuring organizational and employee productivity. It has triggered a significant paradigm shift, requiring organizations to handle social distancing and deploy remote working, which has become vital to address the crisis with resiliency and maintain long-term company viability. Thus, COVID-19 is expected to permanently shift working patterns as companies are forced to embrace remote working, thus increasing the demand for workforce management solutions.

U.S. HR analytics market size, by solution, 2020 - 2030 (USD Million)

The growing need to employ skilled talent and improve employee retention using innovative technologies, such as the Internet of Things (IoT) and analytics, is expected to drive the market. For instance, in April 2020, ASDA, a supermarket chain in the U.K., selected Workday, an enterprise cloud application platform for finance and human resources, to enhance its employee experience and support the global workforce with the help of  Workday Absence Management, Workday Benefits, Workday Compensation, Workday Learning, Workday Prism Analytics, and Workday Human Capital Management (HCM). The adoption of solutions enables companies to improve employee engagement, facilitate employee onboarding, and increase workforce efficiency. Further, these solutions enable HR professionals to attract and retain employees, resulting in a higher Return on Investment (ROI) for the organization, improved productivity, and a better work environment.

The demand for effective workforce management and recruitment is driving the market forward. Several companies use third-party talent acquisition platforms. As a result, vendors are increasingly adopting new technologies. Organizations are turning to technology-based solutions and services to meet their talent acquisition needs. Many of these solutions are cognitive in nature, based on mobile and cloud technology. Cognitive technologies including artificial intelligence (AI), robotic process automation, natural language processing, and predictive algorithms collect data from social networks and then provide actionable insights. The use of these technologies assists organizations in making better decisions and maximizing their capital, which is accelerating the growth of the market.

Technological advancements in Machine Learning (ML), big data analytics, Artificial Intelligence (AI), and the Internet of Things (IoT) are expected to boost the market growth. These technologies correlate and integrate data to provide relevant, actionable, and timely insights to improve performance, ultimately leading to better decisions and actions. For instance, ML enables employers to predict which candidates will perform best, assisting HR management in recruitment and retention processes. Furthermore, it connects and integrates data to deliver relevant, actionable, and timely insights to improve performance, ultimately leading to better decisions and actions. These benefits will supplement the growth of HR analytics solutions during the forecast period.

Modern technological advancements such as predictive analytics, big data, and AI are making it easier to integrate human resource management (HRM) solutions with analytics. Simultaneously, startups are developing collaboration software and mobile applications that would allow employees and employers to access critical information on the go. Further, the use of predictive analytics is beneficial in developing inferences about continuous employee progress via several charts and infographics. Several HRM solution providers such as Workday, Inc.; SAP SE; and Zoho Corporation Pvt. Ltd. are focusing on delivering developing technological trends and designing their software solutions with clients' changing needs in mind. The development of such innovative solutions is anticipated to drive the market during the forecast period.

Solution Insights

The workforce planning segment accounted for the largest revenue share of over 25.0% in 2021. The segment growth can be attributed to the growing need for connected and unified enterprise as well as integrated workforce management systems across diverse locations. Organizations can improve employee performance, productivity, and satisfaction by implementing this solution. Furthermore, workforce optimization can be achieved while simplifying remote working with the implementation of workforce planning solutions and services. These advantages drive the interest of organizations in implementing such solutions to improve workforce operations.

The talent analytics segment is expected to expand at a lucrative CAGR of 16.4% during the forecast period. The increasing use of data for workforce planning, the increased need to identify talent gaps from performance data, and the growing demand for automation and digitalization of manual talent analytics tools are contributing to the segment growth. The talent analytics solution enables organizations to align their goals with talent acquisition activities, which results in increased company performance. Furthermore, the integration of talent analytics solutions enables companies to make improved decisions, and hence, the segment is expected to witness significant growth over the forecast period.

Service Insights

The implementation and integration segment accounted for the largest revenue share of over 35.0% in 2021. The segment growth can be attributed to the increased organizational demand to improve the services of their existing systems, increased automation, and the adoption of cloud computing. These services make it simple for organizations to implement HR analytics and ensure that solutions integrate easily with their external and internal systems, allowing them to get the most out of their IT infrastructure investments. Furthermore, these services enable businesses to access and visualize data, which is then used in decision-making processes. These factors will further drive the segment during the forecast period.

The support and maintenance segment is anticipated to expand at a significant CAGR of 17.4% over the forecast period. Technology is rapidly changing, necessitating system upgrades regularly. HR analytics solutions must be kept up to date with changing technologies, and organizations require vendor support in the event of technical issues. Further, these solutions are required to be updated irregularly in line with the advancements in technology and organizations need strong vendor support for troubleshooting and technical problems. As a result, over the forecast period, support and maintenance services are expected to gain traction.

Deployment Insights

The on-premise segment accounted for the largest revenue share of over 55.0% in 2021. On-premise deployment provides organizations with greater flexibility and control over their IT infrastructure. Further, they are replaceable and offer the tractability to customize operations and enhance plug-ins when required. The on-premise deployment reduces reliance on the internet while also protecting data from potential losses and fraud. Moreover, it eliminates the requirement for onsite staff to have an internet connection to access it, making it completely accessible without the need for a secure connection. These benefits are expected to drive significant demand for on-premise deployment during the forecast period.

The hosted segment is expected to expand at the fastest CAGR of 17.3% over the forecast period. The increasing data connectivity through multi-cloud environments, advancements in information sharing technologies, and the cost benefits of cloud-based analytics solutions can be attributed to the segment growth. Several organizations are eager to have their solutions deployed in the cloud because it provides numerous benefits such as scalability, capacity flexibility, enhanced collaboration, and cost efficiency. SAP's SuccessFactors Workforce Analytics, for instance, enables HR professionals, analysts, and business partners to influence business decisions through data-driven insights and an evidence-based approach to HR. These benefits will supplement the growth of the segment during the forecast period.

Enterprise Insights

The large enterprise segment held the largest revenue share of over 55.0% in 2021. Due to their big workforce, large businesses are frequently confronted with large numbers of employee data. HR analytics help to analyze such vast information with reduced operational costs. These technologies also enable businesses to manage massive employee databases and provide real-time access to employee data from anywhere in the world. Furthermore, numerous huge corporations are implementing big data analytics to boost revenues, improve analytical abilities, and easily access vast employee information. As a result, large enterprises are implementing HR analytics solutions and contributing to market growth.

The small and medium enterprises (SMEs) segment is anticipated to expand at the highest CAGR of 16.0% over the forecast period. As SMEs face more resource constraints than larger companies, they require better strategies to overcome the challenges of cost optimization on their requirements and assets. As a result, SMEs are focusing on using HR analytics solutions to control their solutions across multiple geographies and manage multiple employees. Furthermore, managers can gain a clear picture of employee sentiment, engagement, and productivity with the help of real-time HR analytics. At the same time, they can build on their existing strengths to enhance employee satisfaction and workplace culture in the long run. These benefits will further drive the demand for HR analytics solutions for SMEs during the forecast period.

End-use Insights

The IT and telecom segment held the largest revenue share of over 20.0% in 2021 as it caters to a large workforce and has the technical infrastructure required to deploy analytics solutions. Furthermore, large organizations have a global footprint, which is difficult to manage the globally dispersed workforce, resulting in driving the demand for efficient HR analytics solutions. For instance, several IT services companies such as Turing, Video Husky, and Firstbase use Deel, a global payroll and compliance provider that allows anyone, anywhere to get hired and paid. Additionally, organizations can use Deel to manage their payroll services and create legal contacts in over 150 countries through a tech-enabled self-service process. The deployment of such types of solutions in the industry will further drive the demand for HR analytics solutions over the forecast period.

Global HR analytics market share, by end-use, 2021 (%)

The BFSI segment is expected to expand at a CAGR of 14.2% over the forecast period. Due to competitive pressures and regulatory changes, the sector is undergoing massive disruption. It faces unique challenges such as information security threats, compliance mandates, and low-profit margins. The challenges are motivating the BFSI industry to use HR analytics for workforce associations to reorganize operations and reduce workforce costs. For instance, Wells Fargo & Company deployed Workday HCM in February 2020 to improve user experience and HR efficiencies across the organization for over 260,000 employees. The solutions include Adaptive Insights Business Planning Cloud, Workday Payroll, Workday Prism Analytics, and Workday Time Tracking to help businesses plan, execute, and analyze across the enterprise in a single system powered by machine learning. These solutions would help BFSI organizations effectively deal with the competitive business environment at the tactical and strategic levels.

Regional Insights

The North American market accounted for the largest revenue share of over 30.0% in 2021. The regional market growth can be attributed to the increased adoption of cloud infrastructure by major organizations and the increased productivity and labor efficiency with the help of Human Resource Management (HRM) solutions for attendance and time tracking, payroll management, and talent management. Developed countries such as the United States and Canada have aggressively invested in digital technologies and solutions for efficient business operations. For instance, in June 2022, Visier Inc., a Canadian-based HR analytics platform company, announced the partnership with symplr, a healthcare operations solutions provider, to allow Visier’s people analytics capabilities to embed Visier's people analytics capabilities within Symplr's Recruiting to create a talent analytics feature. These developments will further boost the demand for HR analytics solutions in the region during the forecast period.

 HR Analytics Market Trends by Region

The Asia Pacific region is expected to expand at the highest CAGR of 16.3% over the forecast period. The expanding start-up culture, the desire to boost employee and company productivity and performance, and increasing government initiatives towards the adoption of cloud technologies are likely to drive the regional market. Further, organizations in the region are adopting HR analytics to develop a data-driven talent strategy. For instance, in October 2020, Tata Consultancy Services (TCS) launched TCS Workforce Analytics, an Artificial Intelligence (AI)-based unified system of engagement and insights for managers and employees, which enhanced the productivity and workforce experience. The solution was designed to help enterprises with the talent management challenges of the digital era. These developments will further boost the demand for HR analytics in the region during the forecast period.

Key Companies & Market Share Insights

Market players are observed to invest resources in research & development activities to support growth and enhance their internal business operations. Companies can be seen engaging in mergers & acquisitions and partnerships to further upgrade their products and gain a competitive advantage in the market. They are effectively working on new product development and enhancement of existing products to acquire new customers and capture a greater market share.

For instance, in August 2020, Iron Mounted Incorporated India, an information management services company, deployed the Kronos D5 platform, workforce management, and human capital management cloud provider, to transform its workforce management strategies and business operations in India. With the help of the D5 platform, the company empowers its employees with self-service mobile technology and provides the organization with a unified view of attendance and payroll processes. Some prominent players in the global HR analytics market include:

  • IBM Corporation

  • MicroStrategy Incorporated

  • Oracle Corporation

  • SAP SE

  • UKG Inc.

  • Cegid

  • TABLEAU SOFTWARE, LLC

  • Sage Software Solutions Pvt. Ltd.

  • Zoho Corporation Pvt. Ltd.

  • Workday, Inc.

HR Analytics Market Report Scope

Report Attribute

Details

Market size value in 2022

USD 2.96 billion

Revenue forecast in 2030

USD 8.59 billion

Growth Rate

CAGR of 14.3% from 2022 to 2030

Base year for estimation

2021

Historical data

2017 - 2020

Forecast period

2022 - 2030

Quantitative units

Revenue in USD million/billion and CAGR from 2022 to 2030

Report coverage

Revenue forecast, company market share, competitive landscape, growth factors, and trends

Segments covered

Solution, service, deployment, enterprise size, end-use, region

Regional scope

North America; Europe; Asia Pacific; Latin America; Middle East & Africa

Country scope

U.S.; Canada; France; Germany; U.K.; Australia; China; Hong Kong; India; Japan; Singapore; Thailand; Brazil

Key companies profiled

IBM Corporation; MicroStrategy Incorporated; Oracle Corporation; SAP SE; UKG Inc.; Cegid; TABLEAU SOFTWARE; Sage Software Solutions Pvt. Ltd.; Zoho Corporation Pvt. Ltd; Workday, Inc.

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Global HR Analytics Market Segmentation

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends and opportunities in each of the sub-segments from 2017 to 2030. For this study, Grand View Research has segmented the global HR analytics market report based on solution, service, deployment, enterprise size, end-use, and region:

  • Solution Outlook (Revenue, USD Million, 2017 - 2030)

    • Employee Engagement & Development

    • Payroll & Compensation

    • Recruitment

    • Retention

    • Talent Analytics

    • Workforce Planning

    • Others (Applicant Tracking System and Succession and Leadership Planning)

  • Service Outlook (Revenue, USD Million, 2017 - 2030)

    • Implementation & Integration

    • Support & Maintenance

    • Training & Consulting

  • Deployment Outlook (Revenue, USD Million, 2017 - 2030)

    • Hosted

    • On-premise

  • Enterprise Size Outlook (Revenue, USD Million, 2017 - 2030)

    • Large Enterprise

    • Small & Medium Enterprise (SME)

  • End-use Outlook (Revenue, USD Million, 2017 - 2030)

    • Academia

    • BFSI

    • Government

    • Healthcare

    • IT & Telecom

    • Manufacturing

    • Retail

    • Others (Government, Transportation & Logistics, Energies & Utilities, Travel and Hospitality, and Media and Entertainment)

  • Regional Outlook (Revenue, USD Million, 2017 - 2030)

    • North America

      • U.S.

      • Canada

    • Europe

      • France

      • Germany

      • U.K.

    • Asia Pacific

      • Australia

      • China

      • Hong Kong

      • India

      • Japan

      • Singapore

      • Thailand

    • Latin America

      • Brazil

    • MEA

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