The payroll can be a significant part of an organization’s operations, on both a financial and administrative level. Confusing tax laws and complex employment laws can dramatically affect various areas of a business.
While matters relating to payroll and salaries can cause a lot of headaches and confusion for businesses, there are many different tools that organizations turn to these days, such as compa ratio calculation tools. However, in addition to finding the right payroll and salary tools and solutions, it is important to stay up to date with changes that could affect your business in terms of the payroll.
The following payroll statistics will help you work out how certain employee changes might affect your business. In addition, they’ll help you prepare and learn about various innovative solutions that have the potential to lower your payroll expenses.
Key Payroll Statistics and Facts 2024
- As many as 30% of businesses have misclassified their employees.
- $6 billion in employer penalties were assessed by the IRS in 2020.
- Payroll is outsourced by 45% of small businesses.
- According to four out of ten small business owners, the most time-consuming and worst part of owning their business are taxes and bookkeeping.
- When a company outsources its payroll, there is the potential to save 18% compared to those companies that do it themselves.
Payroll Statistics by Industry 2024
- The number of gig economy workers is 57.3 million.
- The average number of employees per firm in the construction sector is 7.7
- The average number of employees per firm in the healthcare and social assistance industry is 13.8.
- In accommodation and food services, the average number of employees per firm is 15.9.
Employee Payroll Statistics 2024
- 25% of all employees have experienced a paycheck error.
- 65% of workers in the US live from paycheck to paycheck.
- Direct deposit is the payment method used by 93% of workers.
- Paychecks are delivered on time for 93% of employees.
- Nearly 50% of Americans experienced payroll problems.
- Around 72% of Americans experience financial difficulty if their paychecks are delayed by one week.
Effects of Payroll on Employee Statistics 2024
Many employers are now adopting payroll software because it makes the payroll process easier and faster while reducing the risk of errors. However, it’s still important to be aware of common payroll mistakes.
- Once an employee has experienced two paycheck errors, 49% of them will look for a new job.
- 28.83% of US workers would find it very difficult to meet their current financial obligations should their paycheck be delayed for 7 days.
- There are twice as many payroll mistakes in homegrown payroll solutions compared to payroll solutions from third parties.
Small Business Payroll Statistics 2024
- Pen and paper are used for tracking finances by one-quarter of small businesses.
- 45% of small businesses do not have a bookkeeper or accountant of their own.
- Cash flow is reported as a problem for 60% of small businesses.
- Income taxes, including income tax self-assessment, are an extra burden for 77% of small businesses.
- 70% of small business owners think that payroll taxes are a significant or moderate burden.
You might be interested to check those related posts as well:
- 35+ Fascinating HR Statistics 2024 [Facts and Trends]
- Impressive Gig Economy Stats 2024 [Facts and Trends]
- 38 Key Workday Inc Stats and Facts [Important Trends] 2024
How many payroll weeks in a year?
There are 52 work weeks in one year and pay periods typically add up as follows:
Weekly payouts – 52 payroll weeks
Biweekly payouts – 26 payroll periods
Semi-monthly – 24 payroll periods
Monthly – 12 payroll periods
What percentage is payroll tax?
In the US, payroll tax rates are as follows:
Social security: 6.2% for the employer
Social security: 62.% for the employee
Medicare: 2.9%, which is also split evenly between both employer and employee
What percentage of expenses should payroll be?
Generally, your business payroll expenses should be between 15 to 30% of gross revenue. This is considered the safe zone for most types of businesses.
The modern workforce is constantly changing but paying that workforce, whether they are company employees, independent contractors, or gig workers, will always be a vital part of running a business. If you’re not aware of payroll trends, you could find yourself and your company being left behind and exposed to various legal liabilities.
When you internally formalize your payroll processes or partner with a reliable payroll service, it makes life easier and more cost-effective.