Talent Management Software Market by Deployment, Business Segment, and Geography - Forecast and Analysis 2023-2027

The talent management software market is estimated to grow at a CAGR of 11.26% between 2022 and 2027. The market size is forecast to increase by USD 9,153.38 million. The growth of the market depends on several factors, including benefits associated with talent management software, the demand for efficiency in talent management and recruiting, and the rise in the adoption of cloud-based talent management software. 

This talent management software market report extensively covers market segmentation by deployment (cloud-based and on-premise), business segment (large enterprise, small, and medium), and geography (North America, Europe, APAC, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the report includes historic market data from 2017 to 2021.

What will be the size of the Talent Management Software Market During the Forecast Period?

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Talent Management Software Market: Key Drivers, Trends, Challenges, and Customer Landscape

The demand for efficiency in talent management and recruiting is notably driving the market growth, although factors such as the lack of awareness and availability of open-source software may impede the market growth. Our researchers analyzed the data with 2022 as the base year and the key drivers, trends, and challenges. A holistic analysis of drivers will help companies refine their marketing strategies to gain a competitive advantage.

Key Talent Management Software Market Driver

The demand for efficiency in talent management and recruiting is notably driving the market growth. The process of managing human capital is evolving as a result of the expansion of diverse competencies, the rise in specialized HR requirements, and the increasing sophistication of talent management. With the rise in specialized jobs, the evaluation criteria for recruiters are becoming more specialized, niche, and narrow. Completing paperwork evaluations, keeping records of employee performance and having access to them as needed, scheduling training sessions, and managing each employee's compensation plan are a few of the difficult, time-consuming tasks. When performed manually, these tasks run the risk of error. Therefore, to streamline operations and eliminate human error, organizations are increasingly implementing talent management software.

HR managers in multinational corporations (MNCs) are required to only hire individuals who meet certain qualifications, have a specific amount of experience, are from a particular academic institution, are within a certain age range, or have completed a particular course. Competency-based recruiting is the name of this hiring procedure. Organizations need human capital because it has a direct impact on future gains in productivity, profitability, and service quality in today's fiercely competitive market. With the aid of talent management software, HR managers can pinpoint competency gaps that are hindering an organization's expansion. Therefore, such factors will drive the growth of the market during the forecast period.

Significant Talent Management Software Market Trends

The growing use of social media as a real-time data source for talent management software is an emerging trend in the market growth. Due to the growing global adoption of the Internet, social media usage is growing. Internet users choose online platforms to market their goods, services, or talents in order to reach a large audience. For instance, job seekers can update their profiles on online job boards where employers post open positions, such as LinkedIn Inc., Jobcase Inc., Indeed Inc., and Glassdoor Inc. More than 600 million people currently use LinkedIn. On this portal, it is estimated that more than 130 million posts are shared each month. With the proliferation of such portals, the market for online job searches is expanding rapidly. As a result, businesses are utilizing talent management software to integrate multiple online databases and find the best employees for their business.

Using social media platforms for recruitment procedures has a number of advantages, including access to a large pool of potential applicants who haven't actually applied but are looking for work. Employers can use the databases of various social media platforms to cross-check an applicant's credentials.  Therefore, many businesses and organizations are automating their hiring process by using talent management software. Hence, such factors will drive the growth of the market during the forecast period

Major Talent Management Software Market Challenge

Lack of awareness and availability of open-source software are major challenges impeding the market growth. A suite of tools is provided by talent management software to efficiently automate, monitor, and analyze HR functions in businesses. However, one of the main factors impeding the market's expansion is a lack of awareness regarding the availability and advantages of talent management software. Additionally, spending on IT for HR functions is not always welcomed by organizations, especially SMEs. Such businesses follow customary HR procedures and employ customary methods for assessing employee performance. Thus, during the forecast period, the market's growth is anticipated to be constrained by organizations' low investments in the automation of HR functions and a lack of knowledge of talent management software.

The accessibility of free and open-source talent management software is another hindrance to the expansion of this industry globally. The software is created and provided without charge by businesses or a group of developers, and it can be used for profit. Open-source software is being adopted by many organizations, including SMEs, because it allows for source code modification and offers financial advantages. These programs provide the bare minimum of functionality. However, they are deficient in more advanced features like automated tax filing, unlimited payrolls, multiple pay rates, payment schedules, expedited payrolls, tax forms/updates, and time management. Hence, such factors are expected to affect the market during the forecast period.

Key Talent Management Software Market Customer Landscape

The report includes the adoption lifecycle of the market, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their growth strategies.

Global Talent Management Software Market Customer Landscape

Who are the Major Talent Management Software Market Vendors?

Vendors are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

Avalture Ltd. - The company focuses on providing enterprise talent acquisition and management software solutions. The key offerings of the company include talent management software solutions for industries such as Oil and Energy, Pharmaceutical, Finance, Government Contracting, and Healthcare.

The report also includes detailed analyses of the competitive landscape of the market and information about 15 market vendors, including:

• Accenture Plc
• Automatic Data Processing Inc.
• Bambee Inc.
• Bamboo HR LLC
• Bullhorn Inc.
• Cegid SA
• Ceipal Corp.
• Cornerstone OnDemand Inc.
• HireRoad
• iCIMS Inc.
• International Business Machines Corp.
• Learning Technologies Group Plc
• Oracle Corp.
• SAP SE
• Skillsoft Corp.

Qualitative and quantitative analysis of vendors has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize vendors as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize vendors as dominant, leading, strong, tentative, and weak.

What is the Fastest-Growing Segment in the Talent Management Software Market?

The market share growth by the cloud-based segment will be significant during the forecast period. The rapid digitization of businesses and the growing geographic presence of IT and retail companies will cause this segment to grow at a higher CAGR than the on-premises segment. 

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The cloud-based segment was valued at USD 5,110.33 million in 2017 and continued to grow until 2021. Software for cloud-based talent management is typically hosted in distant data centers, allowing users to access it online. The widespread adoption of cloud-based software is being fueled by its low upfront costs. As a result, many businesses provide SaaS-based talent management software. Real-time application performance analytics, regular security updates, global accessibility from any location, and scalability are a few advantages of cloud-based talent management software. Due to these advantages, numerous organizations have begun utilizing cloud-based talent management software. For instance, Skanska AB, a leading construction group, implemented Oracle's human capital management (HCM) Cloud to modernize its HR functionalities. Thus, such factors will drive the growth of the market during the forecast period.

Which are the Key Regions for the Talent Management Software Market?

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North America is estimated to contribute 33% to the growth of the global market during the forecast period. Technavio’s analysts have elaborately explained the regional trends and drivers that shape the market during the forecast period.

North America holds the majority share and is expected to dominate the global market during the forecast period. The rapid digitalization of industries and the growing acceptance of cutting-edge technologies are the main drivers of market expansion in the region. The IT services, healthcare, banking, and retail sectors are primarily responsible for driving demand for talent management software. Moreover, in North America, a number of vendors compete in the global market, such as Oracle. Large, small, and medium-sized businesses, as well as a number of market players, have operations or their headquarters in the US; as a result, the workforce ecosystem for businesses there is extremely competitive.

Businesses can identify, screen, and find candidates due to the rising popularity of professional social media networks like LinkedIn and the growing use of smartphones. A popular professional social networking site, LinkedIn is growing in popularity among recruiters and job seekers as it simplifies the recruitment process. A potential candidate pool can be developed by organizations using talent management software. Data from social media platforms is incorporated by talent management software to give a comprehensive picture of the candidate pool and to conduct trustworthy background checks. The software is increasingly being made available as a mobile-based application for HR managers to post jobs on these apps and search for candidates from a variety of apps.

Furthermore, as it streamlines the hiring process and lowers CAPEX, cloud-based talent management software is becoming popular in the US. Vendors are both launching new cloud-based products and expanding their current offerings through the cloud. For instance, Oracle Corporation introduced Oracle Analytics, a cloud-based HCM platform, in May 2020 to help HR teams make better decisions and boost business performance. As a result, the growth of the market in North America is being driven by the substantial presence and penetration of key vendors like SAP, Oracle, and others. Therefore, all of the abovementioned factors will fuel the market growth during the forecast period. 

In 2020, the outbreak of the COVID-19 pandemic severely impacted the market growth in the region, However, in 2021, with the initiation of large-scale COVID-19 vaccination drives and the lifting of the COVID-19-induced lockdowns, end-user industries in North America that use talent management software, such as energy and utilities, manufacturing, telecom, and retail, resumed their operations in compliance with all the safety measures to contain the spread of the disease and were in recovery mode. Therefore, such factors are expected to propel the growth of the market focus during the forecast period.

Segment Overview

The talent management software market report forecasts market growth by revenue at global, regional & country levels and provides an analysis of the latest trends and growth opportunities from 2017 to 2027. 

• Deployment Outlook (USD Million, 2017 - 2027)
  • Cloud-based
  • On-premise

• Business Segment Outlook (USD Million, 2017 - 2027)
  • Large enterprise
  • Small
  • Medium

• Region Outlook (USD Million, 2017 - 2027)
  • North America
    • The U.S.
    • Canada
  • Europe
    • The U.K.
    • Germany
    • France
    • Rest of Europe
  • APAC
    • China
    • India
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa
  • South America
    • Chile
    • Brazil
    • Argentina

Parent Market Analysis

Technavio categorizes the global talent management software market as a part of the global application software market within the global information technology (IT) software market. The overall global IT software market covers companies that are engaged in developing and producing application and system software. Our market research report has extensively covered external factors influencing the parent market growth during the forecast period.

Talent Management Software Market Scope
Report Coverage	Details
Page number	165
Base year	2022
Historic period	2017-2021
Forecast period	2023-2027
Growth momentum & CAGR	Accelerate at a CAGR of 11.26%
Market growth 2023-2027	USD 9,153.38 million
Market structure	Fragmented
YoY growth 2022-2023(%)	10.2
Regional analysis	North America, Europe, APAC, South America, and Middle East and Africa
Performing market contribution	North America at 33%
Key countries	US, India, Japan, Germany, and UK
Competitive landscape	Leading Vendors, Market Positioning of Vendors, Competitive Strategies, and Industry Risks
Key companies profiled	Accenture Plc, Automatic Data Processing Inc., Avalture Ltd., Bambee Inc., Bamboo HR LLC, Bullhorn Inc., Cegid SA, Ceipal Corp., Cornerstone OnDemand Inc., HireRoad, iCIMS Inc., International Business Machines Corp., Learning Technologies Group Plc, Oracle Corp., SAP SE, Skillsoft Corp., Talent Guard Inc., UKG Inc., Workday Inc., and Koch Industries Inc.
Market dynamics	Parent market analysis, Market growth inducers and obstacles, Fast-growing and slow-growing segment analysis, COVID-19 impact and recovery analysis and future consumer dynamics, and Market condition analysis for the forecast period.
Customization purview	If our report has not included the data that you are looking for, you can reach out to our analysts and get segments customized.

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What are the Key Data Covered in this Talent Management Software Market Research Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the growth of the talent management software market between 2023 and 2027
• Precise estimation of the size of the talent management software market size and its contribution to the parent market
• Accurate predictions about upcoming trends and changes in consumer behavior
• Growth of the market industry across North America, Europe, APAC, South America, and Middle East and Africa
• Thorough analysis of the market’s competitive landscape and detailed information about vendors
• Comprehensive analysis of factors that will challenge the growth of talent management software market vendors

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