Workforce Management Market Size, Share & Trends Analysis Report By Solution (Workforce Scheduling, Attendance Management, Analytics, Absence Management), By Deployment, By Application, By Region, And Segment Forecasts, 2020 - 2025

Report Overview

The global workforce management market size was estimated at USD 6.1 billion in 2019 and is expected to expand at a compound annual growth rate (CAGR) of 10.0% over the forecast period. Factors such as workforce optimization, increasing cloud deployment, and the need to comply with regulatory mandates are responsible for driving the market growth. The growing need for connected and unified enterprise, as well as an integrated workforce management system spread across diverse locations, is anticipated to boost demand across various end-user industries.

The industry encompasses different applications including absence management, time & attendance management, leave management, labor scheduling and budgeting, and workforce analytics. While the demand for complete management suites is high in the industry, mobile-ready applications are expected to gain the highest growth spurt in the foreseeable future. In addition, the need to comply with regulatory bodies such as The Family and Medical Leave Act (FMLA) is estimated to drive the demand for compliance-based absence management solutions over the forecast period.

The standardization and streamlining of labor-related operations is one of the key areas that HR departments across various industries are focusing on. This trend is anticipated to direct the changes in the attributes and specifications of the solutions made available by the vendor. While integration coupled with agility seems to be the most in-demand functionality among end users, its compliance and ease of use will also have a considerable effect on the buying decisions of customers.

Workforce analytics is anticipated to become a significant solution segment and will make new avenues available for future developments in upcoming product suites. As vendors try to differentiate their products amongst seemingly similar portfolios, analytics might offer the cutting edge for companies looking to address the technologically mature markets of North America and Europe. In addition, consideration for regional labor laws, the ability to integrate with other HR applications, and industry-specific attributes are expected to be the prime drivers of demand over the coming years.

Workforce Management Market Trends 

Workforce optimization (WFO) refers to the representation of a wide range of software solutions and integrated business processes, focusing on boosting employees’ efficiency and workforce engagement (WFE). Workforce optimization software sets resources up for success by offering required information and sharing knowledge through a user-friendly dashboard. It enables interaction with respective customers more effectively across a variety of channels. Also, it supports automation in several roles of the employee-employer relationship, thereby improving communication and saving time.

Furthermore, workforce optimization helps increasing customer retention by improving customer engagement and related services. It helps to analyze current and previous communication with customers, consequently finding the root cause of customer conduct and allowing the implementation of customer retention strategies. Enterprises can have detailed access to customer retention management tools and tactics with the use of WFO software, which allows enhancing the company’s customer service capabilities. Besides, workforce optimization offers cost-effective solutions by leveraging analytics and insights to simplify productivity and efficiency. Simplifying productivity with WFO software minimizes labor costs and streamlines the uninterrupted information flowHigh demand requirement for improving productivity.

With the advent of cloud computing, coupled with mobile technology and big data, the methods for business operations optimization have become easier. Whether it’s a CRM system such as Salesforce, marketing automation software, inbound marketing software, or workforce management software, the tools used by enterprises tend to enhance the experience of both their customers and employees significantly. For instance, cloud-based workforce management platforms help to optimize time utilization by automating conventional labor-intensive assignments. Also, it empowers instant communication through a dedicated mobile application, which allows customers to be instantly notified of respective activities, such as a granted leave request or any changes to their schedule.

Cloud-based solution deployment for administering workforce management WFM has become increasingly crucial for enterprises that are under pressure to reduce expenditure, maximize their workplace productivity, and improve their bottom line. The popularity of remote working and the prevalence of mobile devices has made workforce management solutions a necessity for the successful management of resources working across different business sites. The most effective solutions incorporate applications, such as analytics, reporting, employee scheduling, and inquiry resolution metrics catering to the requirements of the flexible modern employee. Cloud-based deployment provides enterprises this flexibility and agility at scale.

Solution Insights

Solutions such as time & attendance management systems have been in use across numerous industries for quite some time and are expected to gain steady growth in the future. These solutions are heavily used in organizations with a large labor force such as manufacturing, healthcare, and retail and will continue to attract customers in the coming years. The time & attendance solutions segment held more than a 37% share of the overall market in 2016.

While the embedded analytics segment is expected to rapidly gain traction in the industry, the absence management segment will also grow at a healthy rate over the forecast period. This growth can be attributed to the need for compliance with government regulatory policies, which are subject to frequent changes and are different for every region. The absence management segment is expected to grow at a CAGR of 11.0% over the forecast period with developed regions governed by strict labor laws witnessing the highest demand.

Deployment Insights

Cloud is the preferred deployment option for workforce solutions in the industry primarily because it facilitates flexibility, cost-saving, and ease of operations. Moreover, marketing efforts by leading solution vendors have been instrumental in establishing cloud as a feasible and streamlined deployment option amongst industries with a traditional outlook. The cloud segment is anticipated to grow at a CAGR of 12.9% over the forecast period.

The on-premise deployment segment is expected to lose considerable market share to cloud deployment over the next couple of years. The segment is anticipated to maintain its dominance in developing countries of the world, where technology is adopted at a slower pace. As a large number of labor management solution users are laggards in technological adoption, the cloud deployment segment is expected to grow in the latter part of the forecast period.

Application Insights

The retail application segment held the largest market share in 2016 at more than 23.1% of the overall revenue and was followed by the healthcare segment. The labor-intensive nature of the segment has been a major factor leading to the adoption of workforce management solutions in these industries. Solutions such as time & attendance and absence management are also in high demand in these application industries.

The banking, financial services & insurance (BFSI) segment is anticipated to grow the fastest in the workforce management market at a CAGR of 12.6% over the forecast period. The demand for labor scheduling and labor budgeting solutions has been increasing in the industry and is the major driver behind the increasing revenue share of the BFSI segment. Furthermore, the growing number of millennials in the workforce of this industry is propelling the demand for labor tracking and employee satisfaction in the segment.

Regional Insights

The European region dominated the industry in terms of revenue for 2016 with a market share of more than 31%. However, the growing number of labor regulations and laws in developing countries such as India and China are propelling Asia Pacific regional growth. As these ecosystems mature, strict implementation of policies will have a profound effect on the compliance capabilities of the leave management solutions.

The North American region, too, generates considerable revenue and will witness healthy growth over the forecast period. As the propensity for technological adoption is higher in the U.S., solutions such as embedded analytics and labor cost forecasting will gain traction in the region. The North American region is anticipated to grow at a CAGR of 9.2% over the next nine years.

Asia Pacific is projected to emerge as the fastest-growing regional market. The growth of the workforce management market in the Asia Pacific can be attributed to the increasing government initiatives and investments in digitization and a growing number of automation projects that aim to enhance organizations' productivity. Additionally, the presence of a large skilled workforce is also expected to drive the market for talent management and recruitment software in the region.

The COVID-19 pandemic has created challenges for the health systems globally, also additional service delivery needs have emerged, which are required to manage the pandemic. Therefore, strategic workforce planning, support, and capacity-building are required to guarantee health system operations. Many countries face pre-existing health workforce challenges, including shortages, maldistribution, and misalignment of needs and skills.

Key Companies & Market Share Insights

The prominent players of the market include Kronos Incorporated, SAP SE, Oracle Corporation, Workforce Software Group Inc., Nice Systems, Active Ops Limited, Nice Systems Inc., and Infor, among others.

Industry players are focusing on enhancing their solutions with extra capabilities including analytics, compliance, and different vendor integration to add a competitive edge to the products. In addition, these vendors focus on making workforce management solutions a tactical tool, rather than a tracking, operations-driven application, which will drive the research & development initiatives in the industry.

Workforce Management Market Report Scope

Global Workforce Management Market Segmentation

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of industry trends in each of the sub-segments from 2014 to 2025. For the purpose of this study, Grand View Research has segmented the global workforce management market based on solution, deployment, company size, application, and region:

• Solution Scope (Revenue, USD Million; 2014 - 2025)

  • Workforce Scheduling

  • Time & Attendance Management

  • Embedded Analytics

  • Absence Management

  • Others

• Deployment Scope (Revenue, USD Million; 2014 - 2025)

  • Cloud

  • On-premise

• Company Size Scope (Revenue, USD Million; 2014 - 2025)

  • Large Enterprises

  • Small and Medium Enterprises (SMEs)

• Application Scope (Revenue, USD Million; 2014 - 2025)

  • Academia

  • Automotive & Manufacturing

  • BFSI

  • Government

  • Healthcare

  • Retail

  • Others

• Regional Outlook (Revenue, USD Million; 2014 - 2025)

  • North America

    •  The U.S.

    • Canada

  •  Europe

    •  The U.K.

    • Germany

  • Asia Pacific

    •  China

    •  India

    • Japan

  • Latin America

    • Brazil

  • Middle East & Africa (MEA)