Home / Information & Technology / Hardware & Software IT Services / Human Capital Management (HCM) Market

Human Capital Management (HCM) Market Size, Share & Industry Analysis, By Offering (Software (Core HR, Talent Management, Workforce Management, Payroll & Compensation, Others (Succession and Planning)) and Services), By Deployment (On-premise and Cloud), By Enterprise Type (Large Enterprises and Small and Medium-sized Enterprises), By End-use Industry (IT & Telecommunication, BFSI, Government, Retail, Healthcare, Education, Manufacturing, and Others (Transportation & Logistics, Energy & Utilities)), and Regional Forecast, 2024-2032

Report Format: PDF | Published Date: Mar, 2024 | Report ID: FBI100240 | Status : Published

The global Human Capital Management (HCM) market size was valued at USD 28.86 billion in 2023. The market is projected to grow from USD 31.34 billion in 2024 to USD 63.14 billion by 2032, exhibiting a CAGR of 9.1% during the forecast period.

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.

Zippia reported that around 97% of companies are looking to increase their investments in recruitment technologies by 2025, with 47% focusing on AI technologies.

The COVID-19 pandemic greatly affected almost every industry's operational structure and policy. The rapid spread of the virus forced governments and business sectors to follow various social distancing and lockdown norms across countries. This is why companies had to adopt work-from-home strategies to ensure business continuity. Thus, implementing these solutions for remote work environments across companies may create ample market opportunities in the coming years.

Human Capital Management (HCM) Market Trends

Adoption of HCM Solutions to Enhance Talent Matching Processes will Act as a Key Trend

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. For instance,

  • In October 2022, sa.global, a Microsoft partner specializing in professional services firms, introduced the new Evergreen HCM. This standalone product for Human Resources utilizes HR features from Dynamics 365 Finance to streamline processes and enhance user experience for project managers (in professional services firms) and fee earners (in law firms).

Similarly, Robot Process Automation (RPA) capabilities embedded with Artificial Intelligence (AI) and Machine Learning (ML) enable enterprises to standardize operations by eliminating additional IT costs. RPA technology is vital for delivering efficiency and innovation within HCM solutions and enables organizations to provide enhanced talent strategies.

Thus, the adoption of cloud and RPA in HCM solutions will create the Human Capital Management market growth opportunities.

Human Capital Management (HCM) Market Growth Factors

Leveraging Cloud Computing for HR and Talent Management across Organizations to Boost Business Growth

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.

With robust cloud-based solutions, the HR and management teams can easily access and provide business and personal data about employees. Cloud-based solutions offer new opportunities for companies by automating heavy and complicated tasks, such as performance review, timesheet submission, and payroll management.

Additionally, some cloud HR management solutions can be customized by HR professionals and corporate employees without the help of IT specialists. Thus, with cloud computing, HR managers can improve productivity and make data-driven intelligent decisions.


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.

The factors mentioned above may hamper the market growth.

Human Capital Management (HCM) Market Segmentation Analysis

By Offering Analysis

Rising Demand for Workforce Operational Insights for HR Management Software Solutions Propels Market Growth

Based on offering, the market is divided into software and services. Core HR, talent management, workforce management, payroll & compensation, and others come under the software segment. These solutions can efficiently manage the employees and maintain transparency between them and the management. Under services, the report covers HCM consulting & application and HR transformation services.

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.

Workforce Management (WFM) solutions help in data analysis for core business processes and maintaining various HR activities. WFM applications are available in several buying options - they can be purchased as part of ERP suites, HR suites, operations applications, workforce management suites, or as stand-alone applications.

Additionally, the requirement for talent management solutions is expected to rise considerably during the forecast period. Adopting artificial intelligence in talent management solutions will expand the market.

By Deployment Analysis

Increasing Adoption of Cloud-based Models across Organizations Creates Growth Opportunity for the Market

Based on deployment, the market is segmented into cloud and on-premise. The cloud segment is expected to witness significant expansion during the forecast period. The growth is attributed to organizations shifting existing solutions to cloud for better user experience, consistent updates, and enhanced analytics & reporting, among others.

Cloud-based business models incorporated with HRM services are expected to demonstrate robust demand from end-users. For instance,

  • In October 2022, Topia launched a remote work software solution, which aided enterprises in managing and supporting a fragmented workforce. It also enhanced the automation of taxes, approvals, risk assessments, and social security. The company aided HR teams in enabling talent mobility and flexibility, and promoting remote working among other employees.

By Enterprise Type Analysis

Large Businesses Focusing on Increasing their Spending for Better Productivity to Drive Market Growth

Based on enterprise type, the market is bifurcated into large enterprises and small and medium-sized enterprises. 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 the global market growth.

Also, 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.

By End-use Industry Analysis

IT & Telecommunication Industry to be Potential Customers of HR Solutions

In terms of end-use industry, the market is divided into IT & telecommunication, BFSI, government, retail, healthcare, education, manufacturing, and others (energy & utilities). The IT & telecom segment is set to hold a sizable market share during the forecast period.

IT & telecommunication service providers are anticipated to significantly adopt core HR, talent management, and workforce management solutions during the forecast timeline. Organizations across industries are opting for HR software to administer employee benefits and address HR operations effectively.

The healthcare industry is projected to experience the highest CAGR growth in the forecast period. As the industry evolves, healthcare organizations must also adapt their HCM systems to stay competitive and attract, hire, and retain top talent.


The market is studied across North America, South America, Europe, the Middle East & Africa, and Asia Pacific.

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.

Europe is expected to show significant market growth during the forecast period. The region is expected to show increasing demand for workforce automation solutions to improve compliance. For instance, industries across the U.K. have deployed workforce management solutions to manage employees. Also, the European Union has implemented a talent management strategy to lessen staff overload for professional growth. Such aspects are likely to create new market opportunities across the region.

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. This will fuel the intensity of hiring across the region. Also, expanding multinational businesses with substantial IT budgets is a major factor supporting the market growth.

Middle East & Africa is anticipated to hold a large market share. The growing mobility of workforces from different cultures and regions is one factor contributing to the region's growth. The IT sector in the Middle East & Africa remains competitive as the industry is undergoing digitization, thereby boosting the requirement for highly skilled employees. Changing work demands and requirements for skills are creating a huge need for advanced skills and capabilities.

List of Key Companies in Human Capital Management (HCM) Market

Market Players to Opt for Merger & Acquisition Strategies to Expand their Presence

Prominent players operating in the global market are focusing on expanding their global presence through merger & acquisition strategies. Rising technological advancements and organizations' adoption of HCM solutions are projected to accelerate the market growth. These companies aim to acquire small and local firms to expand their business presence.

List of Key Companies Profiled:


  • 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.

  • October 2023: IBM and The EY organization announced the launch of EY.ai Workforce, an HR solution that allows organizations to incorporate artificial intelligence into their essential HR operations. This development signifies a crucial advancement in the partnership between the two companies and a major achievement in utilizing AI to enhance productivity in the HR department.

  • October 2023: Darwinbox announced the partnership with PwC U.K., a professional services network. This collaboration enabled Darwinbox to introduce its advanced HR solutions to the U.K. and EU markets. Moreover, it has allowed them to provide clients with improved and quicker implementations, resulting in faster results.

  • November 2022: Deel, an HR software company, successfully acquired PayGroup Limited, a payroll and HCM company based in APAC. PayGroup is now a part of Deel, a private payroll company headquartered in San Francisco. As a result, PayGroup has been removed from the Australian Stock Exchange.


The market research report provides a detailed market analysis. It focuses on key points, such as leading companies, offerings, and applications. Besides this, the report offers an understanding of the latest market trends and highlights key industry developments. In addition to the above-mentioned factors, the report contains several factors that have contributed to the growth of the market in recent years.




Study Period


Base Year


Estimated Year


Forecast Period


Historical Period


Growth Rate

CAGR of 9.1% from 2024 to 2032


Value (USD Billion)


By Offering

  • Software

    • Core HR

    • Talent Management

    • Workforce Management

    • Payroll & Compensation

    • Others (Succession and Planning)

  • Services

By Deployment

  • On-premise

  • Cloud

By Enterprise Type

  • Large Enterprises

  • Small and Medium-sized Enterprises

By End-use Industry

  • IT & Telecommunication

  • BFSI

  • Government

  • Retail

  • Healthcare

  • Education

  • Manufacturing

  • Others (Transportation & Logistics, Energy & Utilities)

By Region

  • North America (By Offering, Deployment, Enterprise Type, End-use Industry, Country)

    • U.S. (By End-use Industry)

    • Canada (By End-use Industry)

    • Mexico (By End-use Industry)

  • South America (By Offering, Deployment, Enterprise Type, End-use Industry, Country)

    • Brazil (By End-use Industry)

    • Argentina (By End-use Industry)

    • Rest of South America

  • Europe (By Offering, Deployment, Enterprise Type, End-use Industry, Country)

    • U.K. (By End-use Industry)

    • Germany (By End-use Industry)

    • France (By End-use Industry)

    • Italy (By End-use Industry)

    • Spain (By End-use Industry)

    • Russia (By End-use Industry)

    • Benelux (By End-use Industry)

    • Nordics (By End-use Industry)

    • Rest of Europe

  • Middle East & Africa (By Offering, Deployment, Enterprise Type, End-use Industry, Country)

    • Turkey (By End-use Industry)

    • Israel (By End-use Industry)

    • GCC (By End-use Industry)

    • North Africa (By End-use Industry)

    • South Africa (By End-use Industry)

    • Rest of the Middle East & Africa

  • Asia Pacific (By Offering, Deployment, Enterprise Type, End-use Industry, Country)

    • China (By End-use Industry)

    • Japan (By End-use Industry)

    • India (By End-use Industry)

    • South Korea (By End-use Industry)

    • ASEAN (By End-use Industry)

    • Oceania (By End-use Industry)

    • Rest of Asia Pacific

Frequently Asked Questions

How much will the global Human Capital Management (HCM) market be worth by 2032?

The market is projected to reach USD 63.14 billion by 2032.

What was the value of the global Human Capital Management (HCM) market in 2023?

In 2023, the market value stood at USD 28.86 billion.

At what CAGR is the market projected to grow over the forecast period of 2024-2032?

The market is projected to grow at a CAGR of 9.1% over the forecast period.

Which is the leading end-use industry segment in the market?

By end-use industry, the IT & telecommunication segment is likely to lead the market.

Which is the key factor driving the market growth?

Leveraging cloud computing for HR and talent management across organizations is expected to drive the market growth.

Who are the top players in the market?

SAP SE, Automatic Data Processing (ADP), Inc., Oracle Corporation, Microsoft Corporation, Cornerstone OnDemand, Inc., Ceridian HCM, Inc., Infor, Inc., Ramco Systems Ltd., Workday, Inc., Paycom Software, Inc., and others are the top players in the global market.

Which region is expected to hold the highest market share?

North America is expected to hold the highest market share.

Which region is predicted to exhibit the highest growth rate?

Europe is predicted to exhibit the highest growth rate during the forecast period.

  • Global
  • 2023
  • 2019-2022
  • 203
  • $ 4850
    $ 5850
    $ 6850
    Buy Now

Information & Technology Clients