A number of factors such as the burgeoning demand for workforce optimization, soaring need for efficient talent retention strategies, evolving work dynamics, increasing requirement for efficient hiring, and rising preference for data-driven decision making are expected to drive the human resource (HR) analytics market at an exceptional CAGR of 15.6% during the forecast period (2019–2024). According to P&S Intelligence, the market revenue will rise from $2,045.5 million in 2018 to $4,763.5 million by 2024.
The escalating demand for efficient hiring is one of the prominent growth drivers of the market, as HR analytics offers insights into potential hires by analyzing their expertise and skillsets. Data procured through such solutions assists enterprises in making an impartial decision to reduce hiring biases. Effective recruitment, therefore, helps businesses attain faster growth and can intensify the competition. Moreover, the deployment of advanced solutions such as artificial intelligence (AI)-enabled HR analytics solutions also helps organizations flag employee flight risk and improve workforce efficiency of employees.
Moreover, the increasing adoption of HR analytics solutions in small and medium-sized enterprises (SMEs), on account of their accelerating shift toward data-driven decision making, will also support the HR analytics market growth, globally. In recent years, a large number of SMEs have deployed HR analytics solutions and services to enhance productivity, owing to which major players have been focusing on offering more-flexible services and solutions to SMEs. With these advanced solutions, SMEs are capturing performance-related data in a standardized framework for better decision making.
The industry segment of the HR analytics market is classified into banking, financial services, and insurance (BFSI), energy and utilities, education, government, healthcare, information technology (IT) and telecom, manufacturing, retail, and others. Under this segment, the BFSI category accounted for the largest market share in 2018. The dominance of this category can be primarily ascribed to the surging need of financial companies to deploy HR analytics solutions to attract talented youth, optimize their performance, and increase the engagement of existing employees.
Currently, the HR analytics market is highly competitive due to the presence of numerous players, such as Workday Inc., MicroStrategy Incorporated, International Business Machines Corporation, ADP LLC, Zoho Corporation, TalentSoft SA, Oracle Corporation, Sisense Inc., Infor Inc., SAP SE, Sage Group PLC, Crunchr, Visier Inc., and Kronos Incorporated. Presently, the market is dominated by Oracle Corporation, SAP SE, Workday Inc., and ADP LLC, as they offer better quality HR analytics solutions than other players.
Globally, North America accounted for the largest share in the HR analytics market in 2018, owing to the rapid technological advancements, extensive IT expenditure, and the presence of numerous large-scale industries and a highly skilled workforce in the region. Whereas, the Asia-Pacific (APAC) market is expected to demonstrate the fastest growth throughout the forecast years, on account of the mounting investments being made by business organizations in improving operations in emerging economies, such as China and India. Additionally, the improving IT infrastructure and accelerating digitization rate will also fuel the market growth in APAC.
Therefore, the surging need for HR analytics solutions and services among SMEs and the rising demand for efficient hiring in enterprises are the prominent growth drivers of the market.
