[Realities of Allowance Payments and Payroll-Related Operations in Mid-sized and Small Businesses] Over 60% cite 'difficulty confirming application basis documents' as an issue in allowance aggregation, while over 40% see 'excessive manual input and transcription' as a challenge. Half still distribute accompanying documents for payslips on paper.

PCA Corporation (CEO: Shiro Tamai, Head Office: Chiyoda-ku, Tokyo, Prime Market Code: 9629, hereinafter: PCA), which develops and sells cloud-based core business systems including 'PCA Arch,' a one-stop support system for finance, accounting, HR, and sales management utilizing AI technology, conducted a survey on the actual state of HR operations in mid-sized and small businesses (50-300 employees) targeting 111 HR back-office staff in departments such as HR and General Affairs. We are pleased to announce the results.

Survey Summary

Survey Overview

Survey Name: Survey on the Actual State of HR Operations in Mid-sized and Small Businesses

Survey Method: Internet survey conducted as part of the research marketing service 'Resapi®︎' provided by IDEATECH.

Survey Period: May 26, 2026 - May 26, 2026

Valid Responses: 111 HR back-office staff in departments such as HR and General Affairs, working at mid-sized and small businesses (50-300 employees).

*The sum of proportions may not always be 100% due to rounding of the second decimal place.

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[Q1] Over 90% of HR back-office staff report having allowances paid based on employee applications.

When asked, "Q1. Does your company have any allowances (payment items) that are paid based on employee applications in the monthly payroll calculation?" (n=111), 90.1% responded "Yes" and 8.1% responded "No."

[Q2] Among allowance items paid based on applications, "overtime allowance" is the most frequent at 61.0%.

When asked, "Q2. For those who answered 'Yes' in Q1, what specific items are included in the allowances (payment items) paid based on employee applications? (Multiple answers allowed)" (n=100), "Overtime allowance based on the number of times and hours of overtime" was 61.0%, "Business trip allowance/per diem based on the number of business trips and days" was 42.0%, and "Night work/late-night allowance based on the number of times and hours of night work" was 40.0%.

[Q3] Regarding the application method for allowances, "Excel" is the top at 54.0%, with about 20% still using "paper" applications.

When asked, "Q3. For those who answered 'Yes' in Q1, please tell us the application method for allowances (payment items) paid based on employee applications. (Multiple answers allowed)" (n=100), "Excel" was 54.0%, "Attendance Management System" was 47.0%, and "Internal System/Workflow System" was 46.0%.

[Q4] Over 60% of HR back-office staff view "difficulty in confirming documents that form the basis of applications" as an issue.

When asked, "Q4. For those who answered 'Yes' in Q1, what challenges do you face in the aggregation process for allowances (payment items) paid based on employee applications? (Multiple answers allowed)" (n=100), "It takes time and effort to confirm documents that form the basis of applications" was 61.0%, "Lack of integration with payroll systems, leading to a lot of manual input and transcription" was 44.0%, and "The rules for payment conditions, etc., are complex, making calculation errors likely" was 38.0%.

[Q5] Regarding initiatives needed to improve aggregation operations, "systematization of applications and approvals" (61.0%) and "systematization of aggregation operations" (57.0%) ranked highest.

When asked, "Q5. For those who answered 'Yes' in Q1, what initiatives do you think are necessary to make the aggregation of allowances (payment items) paid based on employee applications smoother? (Multiple answers allowed)" (n=100), "Systematization of applications and approvals" was 61.0%, "Systematization of aggregation operations" was 57.0%, and "Dissemination of rules regarding payments" was 39.0%.

[Q6] About 90% of HR back-office staff "distribute" documents and papers along with payroll and bonus statements.

When asked, "Q6. Does your company distribute documents or papers along with payroll statements or bonus statements?" (n=111), 88.3% responded "Yes" and 11.7% responded "No."

[Q7] Among documents distributed with statements, "guidance on year-end tax adjustment" is the top at 65.3%.

When asked, "Q7. For those who answered 'Yes' in Q6, what kind of documents or papers do you distribute along with payroll statements or bonus statements? (Multiple answers allowed)" (n=98), "Guidance on the submission deadline and procedure for year-end tax adjustment" was 65.3%, "Announcements such as company newsletters and welfare information" was 41.8%, and "Announcements of company events" was 36.7%.

[Q8] Regarding the distribution method for documents accompanying statements, "distribution on paper such as internal mail or hand-delivery" accounts for half, and "mailing to employee's home address" is about 40%.

When asked, "Q8. For those who answered 'Yes' in Q6, what methods do you use to distribute documents or papers along with payroll statements or bonus statements? (Multiple answers allowed)" (n=98), "Distribution on paper separately from statements, such as internal mail or hand-delivery" was 50.0%, "Mailing to the employee's home address" was 37.8%, and "Internal posting via bulletin boards or circulation" was 32.7%.

[Q9] Among digitized operations, "distribution of payroll-related documents such as payroll statements, bonus statements, and withholding tax slips" is the top at 46.8%.

When asked, "Q9. Please tell us which operations are currently digitized at your company. (Multiple answers allowed)" (n=111), "Distribution of payroll-related documents such as payroll statements, bonus statements, and withholding tax slips" was 46.8%, "Onboarding procedures" was 43.2%, and "Electronic seal/signature for employment contracts" was 41.4%.

[Q10] Operations to be digitized in the future: 1st place "Year-end tax adjustment," 2nd place "Employee overtime and paid leave applications."

When asked, "Q10. Please tell us which operations you would like to digitize in the future at your company. (Multiple answers allowed)" (n=111), "Year-end tax adjustment" was 29.7% and "Employee overtime and paid leave applications" was 27.9%.

Conclusion

This survey was conducted targeting 111 HR back-office staff in departments such as HR and General Affairs, working at mid-sized and small businesses (50-300 employees), to understand the actual state of HR operations in these companies. The results revealed that 90.1% have allowance payment items based on employee applications, and "difficulty in confirming application basis documents" accounts for 61.0% of aggregation tasks.

First, "overtime allowance" (61.0%) was the most common allowance item paid based on applications, followed by "business trip allowance/per diem" (42.0%) and "night work/late-night allowance" (40.0%). The most common application method was "Excel" (54.0%), with "paper" still remaining at 19.0%. Furthermore, the most prominent challenge in aggregation operations was "difficulty and time required to confirm application basis documents" at 61.0%. For improvement measures, "systematization of applications and approvals" (61.0%) and "systematization of aggregation operations" (57.0%) ranked high. The proportion of companies distributing documents along with payroll statements is 88.3%. Moreover, the most common distribution method was "distribution on paper" (50.0%). Finally, regarding operations to be digitized in the future, "year-end tax adjustment" (29.7%) and "overtime/paid leave applications" (27.9%) were mentioned.

This survey suggests that in the HR operations of mid-sized and small businesses, analog operations involving Excel and paper persist strongly throughout the entire process from allowance application and aggregation to statement distribution, with tasks such as document confirmation and manual input/transcription burdening the staff. Considering that HR staff themselves are requesting the systematization of application/approval and aggregation operations, establishing a system that digitizes the entire process from allowance application to aggregation and payroll calculation linkage may be a key point for future efficiency improvements.

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A cloud-based HR and labor management service for companies looking to centralize their HR and labor management operations. It realizes automation and sharing of tasks through AI utilization, and allows for all-in-one use by digitizing operations such as year-end tax adjustment, payroll statements, and personal status applications.

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PCA Corporation Overview

Company Name: PCA Corporation

Established: August 1, 1980

Location: PCA Building, 1-2-21 Fujimi, Chiyoda-ku, Tokyo

Representative: Shiro Tamai

URL: https://pca.jp/

Product and company names mentioned are trademarks or registered trademarks of our company.

Information published in this press release is current as of the time of announcement. It is subject to change without notice.

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