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3 takeaways from the 2019 APA Payroll Benchmarking Study

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It’s that time of year again – the Australian Payroll Association (APA) has published its annual Payroll Benchmarking Study, revealing the key trends in the payroll industry.

The study surveyed 1,831 organisations who pay over 1.5 million employees per annum, making it the largest study of the Australian payroll industry.

This year’s study is particularly relevant for those businesses seeking the best payroll software to ensure Single Touch Payroll (STP) compliance, revealing the number one payroll solutions across multiple industries and business types.

So what are some of the key takeaways from the study?

1. Finding and retaining good payroll staff is a challenge

Good payroll staff are essential to a high quality payroll operation. However they aren’t so easy to come by, says the APA.

“Good payroll people are hard to find, they expect and deserve high wages and are generally not looking for new jobs because they are being actively retained by their employer.”

And it seems holding on to good payroll staff is also a challenge in today’s payroll industry, as revealed by the study. While the employee turnover rate for the general Australian workforce is 8.1%[1], the study reveals that for the payroll industry it sits at 12.67%, up from 11.92% in 2017.

So what makes for a good payroll employee? The APA emphasises the importance of payroll qualifications, stating that “the best payroll professionals are qualified, preferably with a Certificate IV in Payroll Administration or Diploma of Payroll Management.”

However the study reveals that the vast majority of payroll professionals are unqualified, with only 10.1% possessing a competency-based payroll qualification.

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2. Payroll outsourcing is on the rise

The benefits of payroll outsourcing are well known.

It can help businesses make payroll compliance easier by gaining third party expertise to navigate the myriad laws governing payroll and employment. It can help avoid the risk of payroll fraud. And it can help businesses save time.

It’s therefore no surprise that, of the businesses surveyed in the study, 32% outsource their payroll, up from 24.7% in 2018. This is in line with trends in Europe and the US, where 43% of organisations outsource payroll.[2]

3. Sage leads the way in payroll technology

Along with hiring the right people, it’s critical to invest in the right payroll technology.

Tracey Angwin, CEO of the APA, says more Australian businesses relying on payroll software to make their payroll as efficient as possible.

“Watching technology trends since 2012, we are seeing employers place more reliance on payroll products and services that allow for sophisticated reporting and automation of low value tasks such as data entry.”

The introduction of Single Touch Payroll also means Australian businesses are relying on their payroll software to ensure compliance. Sage payroll solutions were amongst the first certified as STP compliant by the ATO. They help businesses simplify Single Touch Payroll compliance, which may account for why more Australian businesses choose Sage payroll solutions than any other.

Providing a detailed breakdown of the most popular Australian payroll solutions, the study reveals 21% of survey respondents use Sage MicrOpay to process payroll, making it the number one payroll solution in Australia.

When broken down by different industries, Sage MicrOpay led the pack in a variety of areas including Arts and Recreation, Education and Training, Utilities, Hospitality, Manufacturing, NFP, Professional and Business Services, Transport and Logistics and Wholesale Trade.

Another of Sage’s payroll products, Sage WageEasy, was the preferred solution for the Agriculture, Forestry and Fishery industries, and was a popular solution for businesses with less than 200 employees.

Special Offer: Save 15% on an Australian Payroll Association membership

Visit the APA website today to become a member and gain access to the APA Benchmarking Survey. Simply use the code SAGE to receive a 15% discount on membership fees.

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[1] Australian Bureau of Statistics, 2018
[2] EY 2017 Global Payroll Survey

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