USD 26.70 Billion
Human Capital Management Market Size, Share, Growth Analysis, By Offering(Software, Services), By Deployment Mode(On-premises, Cloud), By Organization Size(Small & medium-sized enterprises, Large enterprises), By Vertical(BFSI, Government, Manufacturing, IT & Telecom), By Region - Industry Forecast 2025-2032
Report ID:
SQMIG45A2098 |
Region:
Global |
Published Date: October, 2024
Pages:
197
|Tables:
61
|Figures:
75
Human Capital Management Market Insights
Human Capital Management Market size was valued at USD 25.35 Billion in 2023 and is poised to grow from USD 27.5 Billion in 2024 to USD 52.82 Billion by 2032, growing at a CAGR of 8.5% during the forecast period (2025-2032).
Human capital management (HCM) is a collection of HR systems, tools, and practices used to recruit, attract, develop, train, retain, and manage employees to achieve business goals. It features human resource functions, compensation, and the main objective of a company. These solutions are deployed on cloud-based and mobile technology to run reports, process data, and create a smooth end-user experience. The market growth is expected to be driven by the demand for people and performance management solutions, as well as the integration of advanced technologies, such as Robotic Process Automation (RPA) and Artificial Intelligence (AI), into HR solutions to automate HR activities.
Human resource information systems are being invested to effectively manage HR information, better manage employees, gain insights, and improve business outcomes. Companies of all sizes, large and small, are making significant improvements in all aspects of their operations by implementing the right HR technology. The cloud, big data, and artificial intelligence technological advances are changing HR professionals' work and their organizational roles. This human capital management market trend indicates the potential growth in the market studied over the forecast period.
Market snapshot - 2024-2031
Global Market Size
Largest Segment
Software
Fastest Growth
Services
Growth Rate
9.2% CAGR
Global Human Capital Management Market ($ Bn)
Country Share for North America Region (%)
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Human Capital Management Market Segmental Analysis
Global Human Capital Management Market is segmented on the offering, deployment mode, organization size, vertical, and region. By offering, market is segmented into software, and services. By deployment mode, market is segmented into on-premises, and cloud. By organization size, market is segmented into small and medium-sized enterprises, and large enterprises. By vertical, market is segmented into BFSI, government, manufacturing, IT & telecom, consumer goods & retail, healthcare & life sciences, energy & utilities, transportation & logistics, and others. By region, the market is segmented into North America, Europe, Asia Pacific, Middle East and Africa, and Latin America.
Human Capital Management Market Analysis by Offering
As per the human capital management market outlook, the software segment holds the largest market share and is expected to continue its dominance during the forecast period. These solutions assist businesses in delivering enhanced team member experience and higher productivity. The software segment dominates the market in 2023 and is projected to exceed USD 44 billion by 2032. As businesses recognize the critical role of human capital in driving success, they are seeking sophisticated HCM software to effectively recruit, develop, and retain talent. These solutions encompass a wide range of functionalities, including payroll management, performance evaluation, and employee engagement.
The services segment plays an important and growing role in the human capital management market because organizations can effectively deploy, maintain and optimize HCM solutions. This segment includes consulting, implementation, integration, training and support services to ensure easy adoption of HCM platforms are needed to scale up. As companies increasingly adopt HCM solutions tailored to their specific organizational systems, there is greater demand for consulting and implementation services to optimize processes. Continuous advancements in HCM technologies, such as AI and analytics, necessitate ongoing training and robust technical support for users, driving growth in post-deployment services.
Human Capital Management Market Analysis by Organization Size
As per human capital management market analysis, the large enterprises segment is likely to capture a large market share. These enterprises are anticipated to increase their spending on core HR. Large-scale companies have more HR/IT functions. Also, they constitute more HR functions such as payroll, recruiting, and benefits on a larger scale as compared to small enterprises. These factors will contribute to market growth. The large enterprises segment is expected to hold a significant market share, with these organizations projected to increase their spending on core HR functions. Large enterprises typically have more extensive HR/IT functions and operate HR functions such as payroll, recruiting, and benefits on a larger scale than small enterprises, thereby driving market growth.
Also, the small and medium-sized enterprises segment is expected to be the fastest-growing segment due to the increasing need for market players to provide affordable options with positive high-value outcomes. Market players are striving to provide affordable solutions that offer positive outcomes for these enterprises. SMEs are recognizing the importance of efficient workforce management to enhance productivity, retain talent, and ensure compliance with labor regulations. Affordable and scalable cloud HCM platforms, such as Gusto and BambooHR, are making advanced workforce management accessible to SMEs, eliminating the need for costly IT infrastructure. SMEs are leveraging HCM solutions to enhance employee engagement, streamline hiring processes, and optimize payroll management to remain competitive.
Global Human Capital Management Market By Offering (%)
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Human Capital Management Market Regional Insights
As per the human capital management market analysis, North America will likely hold the maximum human capital management market share throughout the forecast period. This is due to the presence of notable vendors, such as Ceridian HCM Holding Inc., Oracle Corporation, and IBM Corporation, among others, and substantial investments in cloud applications. Cloud-based technologies are gaining momentum globally as small firms are adopting cloud-based solutions for creating lucrative business opportunities. The increase in the number of job-seekers due to globalisation and urbanisation, the wider penetration of social media into recruitment processes, and the growing need for cost optimization would have a major effect on human resource management solutions for the region's market. A significant portion of the global demand growth will come from North America during the forecast period.
Asia Pacific is anticipated to showcase a higher growth trajectory. Growing digitization and adoption of advanced technologies, such as Industry 4.0, smart factory, Big Data, and artificial intelligence, are likely to drive the demand for a more skilled workforce. Also, expanding multinational businesses with substantial IT budgets is a major factor supporting the market growth. The development can also be attributed to growing government policies to promote the digitization of business processes and the adoption of cloud-based systems. The regional population is rapidly shifting from the agricultural or manufacturing sector to the service sector, that is further driving regional demand growth.
Global Human Capital Management Market By Geography
- Largest
- Fastest
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Human Capital Management Market Dynamics
Human Capital Management Market Drivers
Leveraging Cloud Computing for HR and Talent Management
- Cloud computing has steadily evolved from a revolutionary IT approach to a major corporate technology. Cloud computing solutions in HR tools encourage organizations to accelerate employee engagement and experience by offering wider features that enhance performance and talent management functionalities. Many businesses are transitioning from traditional human capital management systems to cloud-based solutions to save on infrastructure and maintenance expenses. According to industry professionals, around 60% of companies are utilizing cloud-based solutions for tasks, such as recruitment, workforce management, core HR, and payroll and benefits. Multinational corporations that adopt centralized global payroll systems can decrease labor costs by approximately 50% by streamlining processes, optimizing operations, and implementing automation. This allows HR managers to concentrate on more crucial responsibilities, ultimately boosting overall productivity.
Technological Advancements Bolstering the Market Growth of Human Capital Management (HCM)
- The growth of the market is primarily being driven by rapid technological advancements. The rising demand for automated recruitment processes is a key factor in driving the growth of the global market for HCM solutions. Advances such as the convergence of AI and machine learning technology have made HCM solutions capable of automating recruitment processes. Automated HCM systems help to dramatically reduce the total time, effort and expense associated with the recruitment process.
Human Capital Management Market Restraints
Data Breach and Possible Denial of Service (DoS) Attacks may Hamper Market Growth
- In cloud-based solutions, data breaches or leaks are critical limiting factors. This happens due to security breaches in cloud computing. Unauthorized parties or applications may access the data and other sensitive information stored, accessed or transmitted by employees. The DoS cloud attack could shut down all cloud services to prevent users from temporarily accessing them. In addition to data breaches, if the information is inaccurate, businesses may be subjected to legal proceedings against the employee's data. These entities have a responsibility to protect the privacy of their employees and HCM data.
Security Concerns over Cloud-based Deployment
- Since most HCM software is hosted on a third party's cloud infrastructure, enterprises are worried about security. Most HCM software companies provide HCM software on the cloud to use cloud technology advantages, including security, scalability, and lower IT infrastructure costs. Cloud-based software frequently has strong security built in. Data breaches and hacker risks are eliminated. Many HCM software companies hesitate to accept HR systems and files, which often contain private employee data. Businesses are, therefore, not prepared to migrate their payroll, administrative, and employee data to the cloud.
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Human Capital Management Market Competitive Landscape
The human capital management market is characterized by fierce competition among leading players offering innovative, cloud-based solutions and the use of AI to solve personnel management challenges. Leading players such as Workday, Oracle, SAP, and ADP offer complete HCM suites that lead the market by integrating payroll, talent management, and analytics. Workplace is known for its user-friendly interface and AI-enabled insights, while Oracle and SAP focus on payroll and employee management with a strong emphasis on ADP compliance, and offer scalable, enterprise-level designed for global businesses dominates.
Human Capital Management Market Top Player’s Company Profiles
- Workday (US)
- UKG (US)
- Oracle (US)
- SAP (Germany)
- Dayforce (US)
- ADP (US)
- Paylocity (US)
- Paycom (US)
- Cornerstone (US)
- Microsoft (US)
- IBM (US)
- Cegid (France)
- PeopleStrategy (US)
- Infor (US)
- Ramco Systems (India)
- BambooHR (US)
- Namely (US)
- Workforce Software (US)
- Zoho People (India)
- Sage Group (UK)
- Epicor Software (US)
- Bitrix24 (Russia)
- Gusto (US)
- Benefitfocus (US)
- WebHR (Pakistan)
- EmployWise (India)
- Sympa (Finland)
- ClayHR (US)
- HCM Deck (Hungary)
- Akrivia HCM (India)
- Kenz Innovation (Turkey)
Human Capital Management Market Recent Developments
- December 2023: Workday and Kainos teamed up to introduce "Spark&Grow", a new solution to assist small and medium-sized businesses in implementing Workday efficiently. Kainos will handle the deployment of Workday HCM and Workday Financial Management in just four weeks, providing expert guidance and support along the way.
- October 2023: ADP, a provider of payroll and HR systems, recently launched a customized Human Capital Management (HCM) solution called ADP Workforce Now for Construction. This specialized software is designed to tackle the specific challenges that construction companies face, such as government compliance, job costing, union management, multi-site project management, and workforce recruitment.
Human Capital Management Key Market Trends
- Adoption of HCM Solutions to Enhance Talent Matching Processes: Businesses frequently use emerging technologies, such as machine learning, to enhance various talent-matching processes. These include optimizing job requirements, improving applicant expertise, widening the procurement pool, enhancing internal selection efficiency, and removing partial recruitment. These processes are also assisted by other tools, such as video tests, social sourcing tools, Chatbots, and predictive analytics, to test candidates that suit the role. Additionally, by integrating cloud-based approaches and machine learning technologies, key players are opting for various business strategies to meet changing business needs. They are launching efficient human capital management solutions to increase efficiency and drive business growth.
- Implementation of Remote Working Models to Boost Adoption of HCM Software: Remote working has presented significant opportunities for HCM software as organizations adapt to a distributed workforce model. According to a 2020 survey, 82% of company leaders plan to permit remote work in some capacity, even after the pandemic subsides. This shift has increased demand for HR tools that efficiently manage remote employees, track their performance, and foster effective communication. HCM software with integrated self-service portals enables remote employees to access important HR information, submit time-off requests, and update personal details from anywhere, fostering a seamless and employee-centric experience.
Human Capital Management Market SkyQuest Analysis
SkyQuest’s ABIRAW (Advanced Business Intelligence, Research & Analysis Wing) is our Business Information Services team that Collects, Collates, Correlates, and Analyses the Data collected by means of Primary Exploratory Research backed by robust Secondary Desk research.
According to SkyQuest analysis, the rising application of HCM solutions in human resources processes is expected to drive the human capital management market growth. The increasing number of partnerships and deals between leading companies will further drive market growth. These collaborations bring together expertise, technology, and resources to innovate and enhance HCM solutions for catering to the evolving needs of modern businesses. The increasing advances in artificial intelligence (AI) and information technology (IT) will also likely contribute to North America's human capital management. Asia Pacific is projected to witness fast growth in the future due to the presence of developing economies like China and India. North America has been among the leading regions for the human capital management industry in the forecast period, and the region is likely to witness robust growth during the forecast period as well.
| Report Metric | Details |
|---|---|
| Market size value in 2022 | USD 23.36 billion |
| Market size value in 2031 | USD 48.68 billion |
| Growth Rate | 8.5% |
| Base year | 2023 |
| Forecast period | 2024-2031 |
| Forecast Unit (Value) | USD Billion |
| Segments covered |
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| Regions covered | North America (US, Canada), Europe (Germany, France, United Kingdom, Italy, Spain, Rest of Europe), Asia Pacific (China, India, Japan, Rest of Asia-Pacific), Latin America (Brazil, Rest of Latin America), Middle East & Africa (South Africa, GCC Countries, Rest of MEA) |
| Companies covered |
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| Customization scope | Free report customization with purchase. Customization includes:-
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Table Of Content
Executive Summary
Market overview
- Exhibit: Executive Summary – Chart on Market Overview
- Exhibit: Executive Summary – Data Table on Market Overview
- Exhibit: Executive Summary – Chart on Human Capital Management Market Characteristics
- Exhibit: Executive Summary – Chart on Market by Geography
- Exhibit: Executive Summary – Chart on Market Segmentation
- Exhibit: Executive Summary – Chart on Incremental Growth
- Exhibit: Executive Summary – Data Table on Incremental Growth
- Exhibit: Executive Summary – Chart on Vendor Market Positioning
Parent Market Analysis
Market overview
Market size
- Market Dynamics
- Exhibit: Impact analysis of DROC, 2021
- Drivers
- Opportunities
- Restraints
- Challenges
- Exhibit: Impact analysis of DROC, 2021
- SWOT Analysis
KEY MARKET INSIGHTS
- Technology Analysis
- (Exhibit: Data Table: Name of technology and details)
- Pricing Analysis
- (Exhibit: Data Table: Name of technology and pricing details)
- Supply Chain Analysis
- (Exhibit: Detailed Supply Chain Presentation)
- Value Chain Analysis
- (Exhibit: Detailed Value Chain Presentation)
- Ecosystem Of the Market
- Exhibit: Parent Market Ecosystem Market Analysis
- Exhibit: Market Characteristics of Parent Market
- IP Analysis
- (Exhibit: Data Table: Name of product/technology, patents filed, inventor/company name, acquiring firm)
- Trade Analysis
- (Exhibit: Data Table: Import and Export data details)
- Startup Analysis
- (Exhibit: Data Table: Emerging startups details)
- Raw Material Analysis
- (Exhibit: Data Table: Mapping of key raw materials)
- Innovation Matrix
- (Exhibit: Positioning Matrix: Mapping of new and existing technologies)
- Pipeline product Analysis
- (Exhibit: Data Table: Name of companies and pipeline products, regional mapping)
- Macroeconomic Indicators
COVID IMPACT
- Introduction
- Impact On Economy—scenario Assessment
- Exhibit: Data on GDP - Year-over-year growth 2016-2022 (%)
- Revised Market Size
- Exhibit: Data Table on Human Capital Management Market size and forecast 2021-2027 ($ million)
- Impact Of COVID On Key Segments
- Exhibit: Data Table on Segment Market size and forecast 2021-2027 ($ million)
- COVID Strategies By Company
- Exhibit: Analysis on key strategies adopted by companies
MARKET DYNAMICS & OUTLOOK
- Market Dynamics
- Exhibit: Impact analysis of DROC, 2021
- Drivers
- Opportunities
- Restraints
- Challenges
- Exhibit: Impact analysis of DROC, 2021
- Regulatory Landscape
- Exhibit: Data Table on regulation from different region
- SWOT Analysis
- Porters Analysis
- Competitive rivalry
- Exhibit: Competitive rivalry Impact of key factors, 2021
- Threat of substitute products
- Exhibit: Threat of Substitute Products Impact of key factors, 2021
- Bargaining power of buyers
- Exhibit: buyers bargaining power Impact of key factors, 2021
- Threat of new entrants
- Exhibit: Threat of new entrants Impact of key factors, 2021
- Bargaining power of suppliers
- Exhibit: Threat of suppliers bargaining power Impact of key factors, 2021
- Competitive rivalry
- Skyquest special insights on future disruptions
- Political Impact
- Economic impact
- Social Impact
- Technical Impact
- Environmental Impact
- Legal Impact
Market Size by Region
- Chart on Market share by geography 2021-2027 (%)
- Data Table on Market share by geography 2021-2027(%)
- North America
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- USA
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Canada
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Europe
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- Germany
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Spain
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- France
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- UK
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of Europe
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Asia Pacific
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- China
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- India
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Japan
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- South Korea
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of Asia Pacific
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Latin America
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- Brazil
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of South America
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Middle East & Africa (MEA)
- Chart on Market share by country 2021-2027 (%)
- Data Table on Market share by country 2021-2027(%)
- GCC Countries
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- South Africa
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
- Rest of MEA
- Exhibit: Chart on Market share 2021-2027 (%)
- Exhibit: Market size and forecast 2021-2027 ($ million)
KEY COMPANY PROFILES
- Competitive Landscape
- Total number of companies covered
- Exhibit: companies covered in the report, 2021
- Top companies market positioning
- Exhibit: company positioning matrix, 2021
- Top companies market Share
- Exhibit: Pie chart analysis on company market share, 2021(%)
- Total number of companies covered
Methodology
For the Human Capital Management Market, our research methodology involved a mixture of primary and secondary data sources. Key steps involved in the research process are listed below:
1. Information Procurement: This stage involved the procurement of Market data or related information via primary and secondary sources. The various secondary sources used included various company websites, annual reports, trade databases, and paid databases such as Hoover's, Bloomberg Business, Factiva, and Avention. Our team did 45 primary interactions Globally which included several stakeholders such as manufacturers, customers, key opinion leaders, etc. Overall, information procurement was one of the most extensive stages in our research process.
2. Information Analysis: This step involved triangulation of data through bottom-up and top-down approaches to estimate and validate the total size and future estimate of the Human Capital Management Market.
3. Report Formulation: The final step entailed the placement of data points in appropriate Market spaces in an attempt to deduce viable conclusions.
4. Validation & Publishing: Validation is the most important step in the process. Validation & re-validation via an intricately designed process helped us finalize data points to be used for final calculations. The final Market estimates and forecasts were then aligned and sent to our panel of industry experts for validation of data. Once the validation was done the report was sent to our Quality Assurance team to ensure adherence to style guides, consistency & design.
Analyst Support
Customization Options
With the given market data, our dedicated team of analysts can offer you the following customization options are available for the Human Capital Management Market:
Product Analysis: Product matrix, which offers a detailed comparison of the product portfolio of companies.
Regional Analysis: Further analysis of the Human Capital Management Market for additional countries.
Competitive Analysis: Detailed analysis and profiling of additional Market players & comparative analysis of competitive products.
Go to Market Strategy: Find the high-growth channels to invest your marketing efforts and increase your customer base.
Innovation Mapping: Identify racial solutions and innovation, connected to deep ecosystems of innovators, start-ups, academics, and strategic partners.
Category Intelligence: Customized intelligence that is relevant to their supply Markets will enable them to make smarter sourcing decisions and improve their category management.
Public Company Transcript Analysis: To improve the investment performance by generating new alpha and making better-informed decisions.
Social Media Listening: To analyze the conversations and trends happening not just around your brand, but around your industry as a whole, and use those insights to make better Marketing decisions.
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