This statistic shows the size of the human capital management (HCM) application market worldwide from 2019 to 2025. In 2020, the global HCM applications market was valued at around 33.6 billion U.S. dollars, and it is expected to reach 37.9 billion dollars by 2025.

The global human capital management market was valued at USD 22.14 billion in 2021 and is expected to grow at a CAGR of 7.6% during the forecast period.

Snapshot img

Human Capital Management Solutions Market Size 2024-2028

The human capital management solutions market size is forecast to increase by USD 13.92 billion at a CAGR of 9.52% between 2023 and 2028.

The market is experiencing significant growth, driven by the increasing demand for automated recruitment processes and the emergence of cloud-computing services. Cloud computing enables organizations to access HCM solutions on-demand, reducing the need for costly on-premises infrastructure. Performance management and data analytics are key areas of focus, with organizations seeking to improve employee productivity and engagement. Data security is also a major concern, as companies look to protect sensitive HR data from cyber threats. Mobile applications are becoming increasingly important, allowing employees to access HCM solutions from anywhere, at any time.
However, the trend towards open-source software poses a threat to market players, as these solutions often offer lower costs and greater flexibility. Overall, the market is expected to continue growing, driven by the need to streamline HR processes and improve workforce productivity.

What will be the Size of the Human Capital Management Solutions Market During the Forecast Period?

Request Free Sample

The human capital management (HCM) solutions market encompasses a range of software applications that help organizations manage their workforce, from recruitment and onboarding to performance management and retirement planning. This market is experiencing significant growth due to the increasing demand for efficient and data-driven HR processes. Established companies dominate the market with comprehensive HRMS (Human Resource Management System) and HRISS (Human Resource Information System) product lines, offering features such as talent management, strategic sourcing, and HR analytics. However, emerging companies are also making strides with innovative solutions, including updated HCM software designed to enhance staff experiences and address data security concerns.
The market's size is substantial, with organizations across industries continuing to invest in automating manual labor processes and improving overall workforce management. Despite this growth, challenges persist, including the need for seamless integration with existing systems and ensuring data privacy and security.

How is this Human Capital Management Solutions Industry segmented and which is the largest segment?

The human capital management solutions industry research report provides comprehensive data (region-wise segment analysis), with forecasts and estimates in 'USD million' for the period 2024-2028, as well as historical data from 2018-2022 for the following segments.

Application

  Core HR
  Talent
  Workforce
  Payroll & Compensation
  HR Analytics
  Employee Experience


Component

  Solution
  Service


Deployment

  Cloud
  On-Premise


Enterprise Size

  Large Enterprises
  Small & Medium Enterprises (SMEs)


End-Use

  IT & Telecom
  Healthcare
  BFSIRetail
  Manufacturing
  Education
  GovernmentOthers


Geography

  North America

    US
    Canada


  Europe

    Germany
    UK


  APAC

    Australia
    India
    Japan
    South Korea


  South America

    Brazil


  Middle East and Africa

    UAE


  Rest of World (ROW)

By Application Insights

The core hr segment is estimated to witness significant growth during the forecast period.

The Human Capital Management (HCM) solutions market is experiencing significant growth due to the increasing adoption of digital technologies in organizations and the need for cost savings and operational efficiency. Core HR functions, including employee recruitment, training, payroll, scheduling, benefits administration, internal relations, and safety and compliance, are being automated through HCM software. HR information systems (HRIS) and human resource management systems (HRMS) remain popular solutions for managing employee data and processing HR tasks. Moreover, the integration of social media and machine learning (ML) in HCM software is enhancing employee engagement and talent management. Cloud-based applications and the SaaS delivery model enable remote work cultures and HR automation, making HR processes more efficient.

Data security is a major concern in the HCM market, as sensitive HR data must be protected. Training programs and performance tracking are also critical components of HCM solutions, helping to improve employee productivity and organizational productivity. The e-commerce sector and other industries are increasingly adopting HCM software to streamline HR procedures and make informed decisions based on data analytics. Market demand for HCM solutions is driven by the need to work smarter, reduce time spent on administrative tasks, and improve employee experiences. Cloud platforms and mobile applications are ma

Human Capital Management (HCM) Software Market size was valued at USD 30.18 Billion in 2024 and is projected to reach USD 284.9 Billion by 2031, growing at a CAGR of 37.82 % from 2024 to 2031.

Global Human Capital Management Software Market Drivers

Rising demand for cloud-based solutions: The growing trend of cloud-based HCM software is a major market driver, providing scalability, flexibility, and cost-efficiency. According to a Gartner estimate, 70% of firms worldwide are predicted to use cloud-based human resources software by 2025, showing a considerable move towards cloud-based HCM solutions to streamline workforce administration.

Growing emphasis on workforce analytics and employee engagement: Companies around the world are focusing on data-driven workforce management and employee engagement initiatives to boost productivity and retention. According to a Deloitte survey, 71% of worldwide firms prioritize people analytics, which drives the adoption of modern HCM software with analytics capabilities.

Increased regulatory compliance requirements: The growing complexity of labor laws and data protection standards around the world has increased the demand for HCM software to ensure compliance. For example, the International Labor Organization (ILO) reported that in 2021, more than 45% of firms worldwide experienced compliance-related workforce management difficulties, prompting them to invest in HCM solutions to meet legal norms.

The size of the global human capital management (HCM) market is expected to rapidly increase from US$ 20.54 Mn in 2022 to US$ 43.1 Bn by 2032, at a high CAGR of 7.7%.

The size and share of this market is categorized based on Core HR (Employee Records, Payroll Management, Time and Attendance, Benefits Administration, Compliance Management) and Talent Management (Recruitment and Staffing, Performance Management, Learning and Development, Succession Planning, Employee Engagement) and Workforce Management (Workforce Planning, Scheduling, Analytics and Reporting, Labor Cost Management, Leave Management) and HR Service Delivery (Employee Self-Service, HR Chatbots, Case Management, Knowledge Management, Onboarding Solutions) and Compensation Management (Salary Planning, Bonus and Incentive Management, Compensation Analytics, Pay Equity Analysis, Job Evaluation) and geographical regions (North America, Europe, Asia-Pacific, South America, Middle-East and Africa).

The global human capital management market size reached USD 26.5 Billion in 2024. Looking forward, IMARC Group expects the market to reach USD 50.2 Billion by 2033, exhibiting a growth rate (CAGR) of 7.01% during 2025-2033. The rapid technological advancements, increasing globalization of businesses, growing demand for automation, rising trend of remote work, growing demand for HCM to gain real-time insights into workforce performance, and escalating emphasis on employee engagement and satisfaction are some of the major factors propelling the market.

IMARC Group provides an analysis of the key trends in each segment of the global human capital management market report, along with forecasts at the global, regional and country levels from 2025-2033. Our report has categorized the market based on component, deployment type and industry verticals.

The Human Capital Management Software Market report segments the industry into By Solution (Payroll Management, Talent Management, Workforce Management), By Deployment (On-Premise, Cloud), and By Geography (North America, Europe, Asia, Australia and New Zealand, Latin America, Middle East and Africa). Get five years of historical data and five-year forecasts.

Human Capital Management (HCM) Software Market was valued at USD 16.23 billion in 2023 and is expected to reach USD 26.81 billion by 2029 with a CAGR of 8.56% during the forecast period.

Global Human Capital Management market size is expected to reach $39.32 billion by 2029 at 10.6%, segmented as by component, software, services

Workday Human Capital Management Service Software Market size was valued at USD 5.2 Billion in 2023 and is estimated to reach USD 43.3 Billion by 2031, growing at a CAGR of 11.2% from 2024 to 2031.

Global Workday Human Capital Management Service Software Market Drivers

The market drivers for the Workday Human Capital Management Service Software Market can be influenced by various factors. These may include:

More people are using cloud-based solutions. The move toward cloud computing and SaaS methods is what makes Workday HCM solutions popular because they are flexible, scalable, and cost-effective. Need for Integrated HR Solutions: Businesses want all-in-one HCM solutions that make HR tasks easier, make data more visible, and help them make better decisions.

Global Workday Human Capital Management Service Software Market Restraints

Several factors can act as restraints or challenges for the Workday Human Capital Management Service Software Market. These may include:

High Implementation Costs: Especially for small to medium-sized businesses, the initial investment needed to set up Workday HCM software can be big. This includes license fees, customizations, and training. Integration Difficulty: Combining Workday HCM with older systems and other business programs can be hard and take a lot of time, which could delay rollout and raise costs.

The global human capital management (HCM) market was valued at USD 29.15 Billion in 2024. The industry is expected to grow at a CAGR of 9.10% during the forecast period of 2025-2034 to attain a valuation of USD 69.64 Billion by 2034.

HCM Software Market Outlook

The Human Capital Management (HCM) software market size was valued at approximately USD 25 billion in 2023 and is projected to reach USD 52 billion by 2032, with a compound annual growth rate (CAGR) of 8.5%. This significant growth can be attributed to the increasing need for organizations to streamline workforce management, enhance employee engagement, and improve overall human resource processes. The rising adoption of digital solutions and cloud-based platforms is propelling the demand for HCM software across various industry verticals, as businesses seek to optimize their human resources operations and gain a competitive edge in the global market.

One of the primary growth drivers of the HCM software market is the increasing focus on workforce optimization and talent management. Organizations are increasingly recognizing the critical role that human capital plays in driving business success. Consequently, there is a growing emphasis on implementing advanced HCM solutions that can effectively manage workforce data, improve talent acquisition and retention processes, and facilitate strategic workforce planning. Additionally, the integration of artificial intelligence (AI) and machine learning (ML) technologies into HCM software is further enhancing its capabilities, providing organizations with valuable insights for making informed HR decisions.

Another significant factor contributing to the market growth is the rising demand for cloud-based HCM solutions. Cloud deployment offers several advantages, such as cost-effectiveness, scalability, and enhanced accessibility, making it an attractive option for organizations of all sizes. The flexibility offered by cloud-based platforms allows organizations to adapt quickly to changing business needs and seamlessly integrate HCM software with other enterprise applications. Moreover, the increasing concerns over data security and privacy have prompted HCM software providers to enhance their security measures, thereby boosting the confidence of organizations in adopting cloud-based solutions.

The growing emphasis on employee experience and engagement is also driving the adoption of HCM software. In today's competitive business environment, organizations are increasingly focusing on creating a positive work culture and providing personalized experiences to their employees. HCM software solutions offer a range of functionalities, including employee self-service portals, performance management tools, and analytics dashboards, which empower employees and improve their overall experience. The ability to analyze employee data and gain insights into workforce trends enables organizations to implement effective engagement strategies and drive employee satisfaction and productivity.

The Human Capital Management (HCM) Suite Applications are pivotal in transforming how organizations manage their workforce. These comprehensive applications offer a unified platform that integrates various HR functions, including payroll, talent management, and workforce analytics. By leveraging the capabilities of HCM Suite Applications, organizations can streamline their HR processes, enhance data accuracy, and improve decision-making. The suite's ability to provide real-time insights into workforce trends and employee performance empowers HR professionals to implement effective strategies for talent acquisition, retention, and development. As businesses continue to navigate the complexities of a dynamic workforce, the adoption of HCM Suite Applications is becoming increasingly essential for achieving operational excellence and maintaining a competitive edge in the market.

From a regional perspective, North America is expected to dominate the HCM software market during the forecast period. The region's strong technological infrastructure, high adoption rate of advanced digital solutions, and the presence of key market players contribute to its leading position. Europe and Asia Pacific are also anticipated to witness significant growth, driven by the increasing need for workforce management solutions and digital transformation initiatives across various industries. The Asia Pacific region, in particular, is expected to exhibit the highest growth rate, owing to the rapid expansion of businesses, the growing workforce, and increasing investments in technology.

Component Analysis

The HCM software market is segmented by components into software and services. The software seg

In 2023, the Human Capital Management Market is valued at $26.6 billion, and it is projected to surge to $46.4 billion by 2030 due to increase in startups

The Human Capital Management (HCM) Market size was valued at USD 28.86 USD Billion in 2023 and is projected to reach USD 53.10 USD Billion by 2032, exhibiting a CAGR of 9.1 % during the forecast period. HCM software helps businesses maximize their workforce potential by streamlining HR processes such as payroll, recruitment, and performance management. Human capital management (HCM) is a system of activities that convert routine HR functions into opportunities to increase productivity, peak interest, and revenue for the organization. The difference between HCM and calculating cost of maintaining human resources is that the latter commits to maximizing the value of human capitalism through management and ample investments. Through HCM practices, organizations can build a healthy organizational culture characterized by a development of employees and their commitment to the firm objectives. Employees have the power to choose their career and the organization encourages them to stay and invest their talent in the company for a long time. Human capital management software deals with many functions and processes for efficient workforce management, therefore saves time and money. The HCM software can also be known as a human resource information system (HRIS) or human resource management system (HMRS). Recent developments include: 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.. Key drivers for this market are: Leveraging Cloud Computing for HR and Talent Management across Organizations to Boost Business Growth. Potential restraints include: Data Breach and Possible Denial of Service (DoS) Attacks May Hamper Market Growth. Notable trends are: Adoption of HCM Solutions to Enhance Talent Matching Processes will Act as a Key Trend.

The Human Capital Management (HCM) Software market is expected to grow from USD X.X million in 2020 to USD X.X million by 2026, at a CAGR of X.X% during the forecast period.

Global Human Capital Management HCM market size 2025 was XX Million. Human Capital Management HCM Industry compound annual growth rate (CAGR) will be XX% from 2025 till 2033.

Market Size and Growth: The global Human Capital Management (HCM) software market is projected to reach a value of USD XXX million by 2033, growing at a CAGR of XX% during the period 2025-2033. The market's growth is driven by the increasing adoption of cloud-based HCM solutions, the need to streamline HR processes, and the growing importance of employee engagement and talent management. The Asia-Pacific region is expected to witness the fastest growth due to the rising demand for HCM software in emerging markets. Competitive Landscape and Key Trends: Leading players in the HCM software market include SAP SE, ADP, Ultimate Software Group, LinkedIn (Microsoft), Oracle, Workday, and Ceridian. The market is highly competitive, with vendors focusing on innovation, integration with other business systems, and providing comprehensive HR solutions. Key emerging trends include the adoption of artificial intelligence (AI) for automated HR processes, mobile-friendly solutions, and the integration of wellness and employee well-being programs. The market is also witnessing the rise of specialized solutions such as HR analytics and talent acquisition platforms.

The size and share of this market is categorized based on Core HCM Suite (Recruitment Management, Talent Management, Payroll Management, Performance Management, Workforce Management) and Talent Acquisition Solutions (Applicant Tracking Systems, Onboarding Solutions, Candidate Relationship Management, Job Board Integration, Recruitment Analytics) and Employee Engagement Solutions (Surveys and Feedback Tools, Recognition Programs, Performance Reviews, Employee Development, Succession Planning) and geographical regions (North America, Europe, Asia-Pacific, South America, Middle-East and Africa).

The global human capital management market size is expected to reach USD 41.38 billion by 2030, according to a new study by Polaris Market Research