REWARD
Skills gap in payroll: bridging the divide in 2025
Saskia Hawkins, Partner and Payroll Operate Leader for UK and Ireland, EY, explains how organisations should prepare to bridge the skills gap by training their payroll teams as we continue into 2025 and beyond
I n today’s fast-paced and digitally – it can now be a strategic pillar of organisational success. Yet, as the role of payroll evolves, a widening skills gap often threatens to undermine its potential. A 2024 EY survey underscores this challenge, revealing that the gap isn’t always limited to traditional payroll driven business environment, payroll is no longer a back-office function competencies but can extend into critical areas such as data analytics, cybersecurity and regulatory compliance. This article explores the nature of the payroll skills gap – the difference in skills that were previously essential, compared to the expanding remit of the payroll team and the associated competencies. There are clear implications for many companies, and some actionable steps business leaders can take to help bridge the skills gap in 2025 and beyond. The traditional payroll role: a foundation under pressure Historically, payroll professionals had a simple brief: to ensure employees were
paid accurately and on time. This required a solid grasp of payroll systems, tax rules, industry best practice and internal policies. However, while these core competencies remain essential, it’s unlikely that will be all that’s needed in the future. Today’s payroll teams must frequently navigate a more complex landscape – one shaped by globalisation, remote work, a mobile workforce, digital transformation and heightened regulatory scrutiny. As a result, the expectations placed on many payroll professionals have expanded dramatically. The evolving skill set: beyond the basics According to a 2024 EY survey, 65% of organisations struggle to find payroll professionals with the necessary skills. Many companies are increasingly seeking team members who bring a broader, more strategic skill set to the table. Some of the key areas of demand include:
of insights into workforce trends, absenteeism, turnover and compensation equity. There’s an increased need for professionals who can analyse this data and translate it into actionable intelligence. Analytics platforms can help unlock the value in payroll data, but people will need training to use them. Data security and privacy With payroll systems housing sensitive personal and financial information, data breaches can have severe legal and reputational consequences. Payroll professionals must understand data protection laws such as the General Data Protection Regulation and implement best practices in cybersecurity. Security audits are likely to become ever more arduous if people don’t know how to respond. Regulatory compliance The regulatory environment is in constant flux, with new labour laws, tax codes and reporting requirements emerging regularly, both in the UK and globally. Payroll professionals must stay informed
Analytics and data interpretation Payroll data can be a rich source
| Professional in Payroll, Pensions and Reward | September 2025 | Issue 113 38
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