IBISWorld Market Research
Investment in further automating industry processes is expected to improve profit margins.
Melbourne, Australia (PRWEB) April 26, 2014
The Payroll and Other Office Administrative Services industry has benefited from the private sector trend towards outsourcing business services over the past five years. The industry generates the bulk of its revenue from the payroll processing and billing segments, which have been the primary beneficiaries of the outsourcing boom. However, the sluggish general economy has contained the industry's performance since the late 2000s. The industry relies heavily on business confidence and spending, as these influence an organisation's choice to outsource non-core activities to specialist service providers. The global financial crisis contributed to a decline in demand for industry services. This decline was offset by the efficiencies available from outsourcing non-core services and advancements in technology that made these services cheaper and improved accessibility for clients.
IBISWorld forecasts industry revenue to increase by an annualised 4.5% over the five years through 2013-14, to total $2.8 billion, including growth of 3.9% over the current year. The industry comprises many small-scale businesses, which are often one- or two-person operations servicing narrow regional markets. Larger players such as ADP and Sage MicrOpay service a large number of medium and large-size businesses and employ a relatively small number due to automation and software efficiencies. IBISWorld industry analyst Sebastian Chia states, “The industry's future looks promising given the projected resurgence of business confidence over the next five years, which will bring with it increased labour participation and a larger pool of potential clients.” A key growth driver will be continued increases in business process outsourcing, particularly as organisations decide to focus on core operations and externalise laborious and time-consuming administrative services to create efficiencies. The benefits of this model are now well established in the Australian business community. According to Chia, “Growth in technology and increased automation will boost industry profit and attract new participants looking to capitalise on new segments and opportunities.”
The Payroll and Other Office Administrative Services industry has a low level of market share concentration. This low concentration is particularly evident in the billing and payroll segments, which tend to attract sole proprietors that service a niche of small and medium clients. The low level of concentration also serves as an indicator of the highly streamlined and automated nature of the industry's services. While payroll services do require specialised training in domestic laws and policies, they do not need any intensive capital requirements or a large pool of labour. The growth in customised software solutions has made it possible for smaller organisations to service much larger clients, particularly in the business administrative and clerical services segments. The industry’s only major player is Automatic Data Processing Limited. For more information, visit IBISWorld’s Payroll and Other Office Administrative Services report in Australia industry page.
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IBISWorld industry Report Key Topics
This industry includes companies that provide a range of everyday office administrative services such as clerical, billing and record-keeping, and payroll services on a contract or fee basis. These companies support the operation of a business but do not provide staff to carry out the complete operations of an organisation.
Industry Performance
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Industry Life Cycle
Products & Markets
Supply Chain
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International Trade
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Industry Globalisation
Major Companies
Operating Conditions
Capital Intensity
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Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.