EMPLOYER OF RECORD MARKET REPORT OVERVIEW

The global employer of record market was valued at USD 5 billion in 2024 and is expected to grow at a compound annual growth rate (CAGR) of 6.8% to reach USD 9 billion by 2033.

A third-party entity that handles all official employment duties on behalf of another business is known as an employer of record (EOR). Without having to establish a local organization or run the risk of breaking local employment rules, the EOR enables businesses to effectively and lawfully interact with foreign workers in a new nation or state. An EOR can help the client's business manage their time more successfully and efficiently.

The words Professional Employment Organization (PEO) and Global Employment Organization (GEO) are commonly encountered in companies that are extending their markets. An organization can hire workers in a foreign market without having to establish a local corporation by using a Professional Employment Organization (PEO), also referred to as an International/Global PEO. A PEO is a service company that typically provides a wider range of HR services, despite their striking similarities to an Employer of Record. In that it enables the administrative HR burden to be transferred from a customer to a Global Employment Organization (GEO), it shares characteristics with an EOR but is more akin to a PEO.

One of the first and most significant advantages that businesses experience when utilizing EOR services is the opportunity to access international markets. EOR makes it simple for businesses to hire remote workers from any location, which will significantly speed up their company's expansion. Businesses are increasingly conducting business online, therefore regardless of where they are located, they are hiring the best qualified employees to maximize economic value. Economies that must address a labor deficit or have an aging population are also inclined to look for overseas labor.

A business may genuinely go where the talent is by using the Employer of Record Solution to hire people from outside of their current base. By sponsoring work permits and visas for employment, it can also encourage lawful immigration based on employment.

COVID-19 IMPACT

positively affected the market due to demand for workforce

Human resources teams and departments were obliged to adapt new strategies for reacting to labor force demands or employee requests due to the rapidly shifting market dynamics of operating models. Therefore, following COVID-19, there should be a greater need for record solutions, such as workforce leadership, talent management, and recruiting.

One of the key institutions that has embraced the public to address complex issues, such as health and economic disasters, is the shift to a remote work culture and virtual collaboration. The service assisted professionals in efficiently managing staff records and a few other tasks. Major market participants concentrated on cooperation, partnerships, and research and development that aids businesses in managing their workforces throughout the epidemic.

LATEST TRENDS

Robotic process automation is a new trend in market

Robotic process automation technology plays an important role in efficiency and innovations in employee record solutions and enables organizations to provide better talent strategies. Companies are looking for new ways to hire experts and offer new services at lower costs. RPA features embedded in Artificial

Artificial intelligence (AI) and machine learning enable companies to standardize their operations   Elimination of additional IT costs. Market players offer advanced tools that are integrated with RPA to meet the requirements of end users. Thanks to the positive results of RPA integrated into employer of record, the employer of record market players are likely to combine RPA with employer of record including recruiting software and application tracking system in employee record solutions.

EMPLOYER OF RECORD MARKET SEGMENTATION

By Type Analysis

According to type, the market can be segmented into aggregator model and wholly owned infrastructure model.

By Application Analysis

Based on application, the market can be divided into SMEs and large enterprises.

DRIVING FACTORS

Global Recruitment and Removal of Local Labor Law Restrictions to drive market trends

Any global company considering overseas expansion needs the right people to make the project a success - and often that means hiring locally. Employees are a company's most important resource, and their use can make or break an expansion project. Companies could choose to bring foreigners to a new country or hire locals who know their market inside out.

Due to differences in local labor and tax laws, global employment can be difficult and the penalties for getting it wrong can be high. Google was criticized last year for not properly paying its workers in the UK, Europe and Asia, a move that could have significant financial consequences. The Global Employment Service ensures that all international employees work in the country and receive a legal wage. For global employment or entering new international markets, employee compliance is key. Professional staffing services give businesses the peace of mind that all local regulations are being properly followed, leaving them to focus on the logistics of expansion.

Software Working as an Alternative in Setting Up Legal Entity to Augment Its Demand

Global expansion is a big step and the last few years have shown us that the business environment is anything but predictable. Of course, companies may want to try a target on for size before asking their resources for the long term.

Employer of Record offers businesses a presence in new locations without having to go through the timelines and financial burdens of setting up their own business. The mechanism is also useful when the project is temporary.

Once they realize the success of their product or service in this employer of record market growth, they may want to establish their operations locally. Employees can be transferred by the Employer if the company is operating and providing work.

RESTRAINING FACTORS

Risk of data privacy to hinder market growth

Employee record solutions provide effective digital employee management   to the clients or companies. they can control payroll, forms, and other employee performance with a few clicks in the system. 

Due to COVID-19, social distancing has played a crucial role in the transition of businesses traditional communication and collaboration methods with digital infrastructure. The employee of record solutions has proven to be a successful way to run companies with ease in restrictions. The transition from the workplace to working at home has been a huge experience for companies, a challenge in addition, employee records also increase information security risks. Therefore, it is also reviewing employee record solutions to ensure it meets your specific security needs is essential for personnel management. Lack of data security and privacy can be an obstacle employer of record market growth.

EMPLOYER OF RECORD MARKET REGIONAL INSIGHTS

North America will dominate the market due to the growing job opportunities in the region

North America held the largest market share in the global market in 2021 due to Headquarters presence at leading employee record solution providers such as deel rising job opportunities in the region, Remote tech, remote team and Papaya global.  this increase in job opportunities in the US and Canada, the demand for concrete talent and recruitment solutions. 

Asia Pacific will witness the highest growth during the forecast period.

A wave in partnerships, financing and investments to further expand small and medium-sized businesses that are expected to accelerate the growth of the market in this region.  Growing adoption of technologies such as cloud, artificial intelligence and ML is expected to facilitate demand for employee record solutions in the industry

KEY INDUSTRY PLAYERS

Key Players Focus on Partnerships to Gain a Competitive Advantage

Prominent market players are making collaborative efforts by partnering with other companies to stay ahead of the competition. Many companies are also investing in new product launches to expand their product portfolio. Mergers and acquisitions are also among the key strategies used by players to expand their product portfolios.

List of Top Employer of Record Companies

• Adecco
• Randstad
• Aquent
• FoxHire
• Infotree Global
• Safeguard Global
• Velocity Global
• Globalization Partners
• Shield GEO
• Acumen International
• Remote Team (Gusto)
• Deel
• Remote Technology
• Elements Global Services
• Papaya Global
• Universal Hires
• CIIC
• Links International
• New Horizons Global Partners
• Sky Executive

REPORT COVERAGE

This study examines a report that includes in-depth research that describes the market firms that have an impact on the forecasted period. By examining the elements such as segmentation, opportunities, industry advancements, trends, growth, size, share, and constraints, among others, it provides a thorough analysis based on thorough research. If the major companies and the likely analysis of market dynamics change, this study could be modified.