Payroll industry benefiting from technology-driven advancements, CloudPay’s annual Payroll Performance Index report reveals

Payroll errors are decreasing, but data entry errors are the majority of the problems

RALEIGH, NC, May 29, 2024–(BUSINESS WIRE)–The growing role that technology is playing in global payroll cycles is benefiting payroll teams and reducing number of CloudPay errors.

Globally, the number of issuances per 1,000 payslips has fallen for the second year in a row and is now 35% lower than five years ago. Data entry problems, the proportion of problems caused by data entry errors among all problems affecting pay, has also fallen slightly, down 1.1% year-on-year and is now 10.1% lower than when the report was first published in 2019 .these numbers indicate overall higher data quality. Nearly two-thirds (63%) of all payroll problems are due to data entry errors.

In the United States, the percentage of first-time approvals that are approved on the first try and require no changes is 69% compared to 74% globally. This leaves the United States with a lot of room for improvement in the areas of data accuracy and workflow.

– commented Grant Tasker, Senior Director of Global Payroll at CloudPay: :

“The declines in both DII and I/1000 demonstrate a greater focus on accuracy in the payroll industry. I have no doubt that this is a direct result of the increase in technological innovation that we continue to experience. At the same time, companies still have a long way to go. Nearly two-thirds of payroll errors are due to data entry. It’s clear that more organizations need to automate their payroll processes. Leveraging the right technology will help companies achieve the accurate and timely payroll processing they expect.

PEI’s report is based on an analysis of over one million pay stubs that CloudPay processed in 2023 from over 130 countries. Traditional and widely used payroll metrics, such as timeliness and accuracy, very often give a false positive picture of the results of payroll operations. In turn, PEI CloudPay’s annual report focuses on a series of key performance indicators (KPIs) specifically designed to provide true insight into the time, costs and complexity required to deliver payroll: first-time approvals (FTA), data entry issues (DII) ), issues per 1000 payslips (I/1000), calendar length (CAL) and additional impact (SI).

New pay cycle

Payroll cycles are increasing. Calendar lengths in the Americas have increased by more than 60% in just three years as many companies in the U.S. and other regions have moved from weekly or biweekly pay cycles to monthly pay cycles. Technology-based solutions such as Earned Wage Access, which gives employees access to their wages as they earn them, have enabled employers to run payroll less frequently, giving payroll teams more time to complete the process.

The story continues

The impact of artificial intelligence

While PEI data is trending positively, the numbers have started to stabilize, indicating that it may be difficult to make additional significant improvements without further innovation. While AI has not yet been widely adopted in the payroll space, it has the potential to move payroll to a strategic part of the business.

Tasker added: “Technology enables the integration of HR, payroll and payments to create one seamless, modern payment experience. Companies that leverage this opportunity will unlock even greater efficiencies across the business.”

To learn more, visit: www.cloudpay.com.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240529393008/en/

Communication

Anna Warren
[email protected]
770.328.8384