Corporate headcounts have shrunk over the last six months, but payroll professionals are still sought after and they own salaries are staying strong.

How can it be that payroll – a sector shunned by qualified accountants – is performing well when most companies have fewer employees to pay? A severe skills shortage, the growth of redundancy-processing work, and the pre-recession leanness of payroll teams are three key reasons.

Payroll headcounts don’t usually drop dramatically during downturns, says Matthew Cook, managing director, Michael Page Finance.

“If you cut 20% of your overall headcount, it doesn’t always follow that payroll staff will be cut by the same amount. Payroll teams are usually very well managed and efficient. Overall headcount in a business would need to drop by greater than 20% to have an impact on the actual payroll team size,” he adds.

Cook reckons payroll placements are up compared to a year ago, while redundancies remain rare. “A lot of payroll is automated and most efficiencies were already in place before the downturn. Not many businesses had much fat in their teams to trim,” he adds.

Mark Robinson, manager at recruiters AccountAbility, says it’s not uncommon for medium to large companies to have just one payroll person. “And payroll is a critical function, so employers often need to find replacements right away,” he adds.

Robinson describes the talent shortage as “massive”, especially for those with payroll-system skills. And it’s no good looking overseas for staff. Employers struggle to recruit foreign candidates because payroll jobs demand knowledge of local tax and awards, he adds.

“There just aren’t enough people to choose from. This has inflated salaries over the last few years. Salaries in Australia are higher than in the UK because of the shortage,” says Robinson.

The pay range for mid-level payroll staff at large companies is $65k to $90k, according to Cook. Senior people can earn $130k to $180k.

Another recruiter, who asked not to be named, thinks payroll people are overpaid. “Their skills often don’t equate to their salaries. After all, they aren’t even qualified accountants.”

But there are no signs of salary decreases on the horizon as workloads remain high. Robinson says payroll staff have been especially busy during the downturn calculating and processing redundancy payments, leave entitlements and benefits for staff who have lost their jobs.

Payroll is a function where candidates can easily move between the financial services and corporate sectors, says Cook. “The skills are transferable. It’s your knowledge of payroll software - such as SAP or Oracle – that will land you a job.”