When it comes to either insourcing or outsourcing payroll services, we’ve seen a 27% jump since 2015 in the number of organizations who say their payroll organization is currently being serviced solely using in-house resources and a corresponding decrease in the number of companies currently using a fully outsourced solution. This shift may result from the commoditization of payroll, and therefore increased simplicity and cost effectiveness of bringing in house. Additionally, the reason may be due to dissatisfaction with providers as was noted in previous surveys. While the root cause likely varies across organizations, the impacts associated with organizations aligning to their preferred service model, whether in-house or outsource, have noted clear benefits including increased payroll accuracy, better control, and cost savings.
Alternatively, for a third straight time, legislative compliance returns as the number one challenge organizations face when it comes to payroll service delivery. This is hardly surprising given the exponential increase in legislative complexity as digital technologies give governments and policymakers more options for just-in-time or real-time tax revenue collection. At the same time, the rise of the contingent workforce and the need for on-demand payment spawns its own legislative issues.