New York, NY (PRWEB) June 02, 2014
The Payroll and Bookkeeping Services industry includes businesses that focus on the provision of payroll processing and bookkeeping transactions for other businesses. This allows time-scarce managers and businesses to focus on their core functions rather than secondary tasks such as payroll processing. The act of outsourcing business functions has become increasingly common over the past decade and, therefore, the industry has continued to grow, even among difficult conditions presented by the recession. According to IBISWorld Industry Analyst Jeremy Edwards, “Corporate profit plunged in 2009, and the number of businesses remained stagnant as turbulent conditions deterred new entrants to the economy.” Furthermore, many businesses reacted to free-falling profitability by cutting their workforce and reducing their need for payroll and bookkeeping services. As a result, the industry experienced a 0.8% decline in 2011 due to the lag effect of businesses reacting to the recession.
Following the small contraction in industry revenue, the industry was quick to bounce back. Corporate profit across the general economy surged, and businesses increased their workforces and accelerated business outsourcing. The national unemployment rate fell and more businesses opened, which generated new demand for payroll and bookkeeping professionals. Consequently, industry revenue is estimated to grow at an average annual rate of 4.1% to $5.9 billion over the five years to 2014. This will include a 3.6% increase in revenue in 2014, as conditions improve from a slight slowdown in 2013.
Over the next five years, the industry is expected to experience more consistent gains as the number of businesses and corporate profit slowly trend upward. “The absence of any major recessions and global downturns such as the one experienced over the past five years will abate volatility and result in the industry performing in line with the overall economy,” says Edwards. New technology such as web-based employee portals that encourage self-service are also expected to help the industry grow, with more firms electing to have employees handle their own benefits and administration. Overall, the industry is expected to grow over the five years to 2019.
The Payroll and Bookkeeping Services industry is highly fragmented, with the majority of firms operating as small nonemployers. The majority of the industry is composed of small firms that provide services to local areas of the community. Payroll and bookkeeping services follow business creation trends and aim to provide services so that firms can focus on their core functions. In 2014, the three largest companies in the industry are estimated to account for a relatively small share of industry revenue. Automatic Data Processing Inc. is the only major player in the industry, which is due to the vast range of services the company provides and their focus on the development of employee self-service software.
For more information, visit IBISWorld’s Payroll and Bookkeeping Services in Canada industry report page.
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IBISWorld industry Report Key Topics
The Payroll and Bookkeeping Services industry provides outsourced payroll services for clients' employees. Basic bookkeeping services are also covered in this report. This industry does not include tax preparation firms and certified public accountants (CPAs).
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized 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 US and Canadian 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 Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.