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NelsonHall's 2014 - 2018 HRO BPO Market Forecast

NelsonHall’s annual HRO Market Forecast, 2014-2018, provides a forecast for the global HR BPO market by service line and geography. It includes: 

  • The HR BPO market size for 2013 and the forecast through 2014 to 2018
  • The HR BPO market size and forecast for North America, specifically covering the U.S. and Canada; EMEA including U.K., France, Germany, Italy, Nordics & Finland, Benelux, Iberia, Africa and Middle East; Asia Pacific including Oceana, China, India and Japan; Latin America including Argentina, Brazil and Mexico
  • The market size and forecast for HR BPO covering multi-process HR outsourcing, payroll BPO, benefits administration, recruitment process outsourcing, and learning BPO
  • Identification of the leading vendors together with their revenues and market shares by geography and by service.

The HR outsourcing market remains strong across payroll, benefits administration, recruitment process outsourcing, learning BPO, and multi-process HR outsourcing. Overall growth in HRO continues to be driven by process and geographic standardization across organizations accompanied by an increasing need to support globalization of operations.


Within multi-process HRO:

  • The global MPHRO market is led by the U.S. which remains the most mature for MPHRO services and will continue to grow, fueled by mid-market activity
  • Within MPHRO, multi-country standardization and core business focus segments have the highest growth rates
  • Expect future growth to include cloud-based platforms.


Within payroll outsourcing:

  • North America continues to dominate the payroll outsourcing market
  • Asia Pacific and Latin America seeing the highest growth
  • Higher growth is forecast in Europe in 2014-2018, due to demand from multi country payroll buyers looking to consolidate multiple payroll systems and ensure compliance with local country laws.

Benefits Administration

Within benefits administrations:

  • Pension/retirement market growth will come from an increase in the number of participants served as hiring continues as well as auto enrollment legislation in the U.K.
  • H&W administration as well as additional H&W services, specifically health insurance exchanges and health and wellness services, will grow as a result to control costs and comply with changing legislation
  • Technology enhancements will include launching mobile technologies, including apps, redesigning participant portals and manager dashboards.

Learning BPO

The principal benefits derived from LBPO are:

  • Cost savings, largely attributed to an increase in content development 
  • Standardization, consistency and improved processes, accelerated by consolidation and centralization of disparate processes and learning organizations
  • Improved employee performance and productivity, including acceleration of competencies.


RPO is the fastest growing services sector in the 2014-2018 forecast. The top three drivers of RPO are:

  • Increasing talent demand and lack of capability to fulfill the demand
  • Scalability to manage operational resources to support spikes in demand and/or expand to new markets
  • Improving process effectiveness to fill positions with higher quality candidates.

The largest purchaser of RPO is the manufacturing/engineering sector, followed by financial services, technology and pharmaceuticals. Since 2011, the government and defense sector has grown, mainly as a result of the ramp up of Capita’s British Army contract and Manpower Group Solutions RPO contract renewal with the Australian Defense Force. Industry growth is across all service sectors.

The report lists the top ~25 vendors by revenue in 2013 overall and across service lines:

  • Payroll
  • RPO
  • Learning BPO
  • Benefits administration.

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