The Workforce Mobility Shift · Payroll compliance trends
Payroll complexity isn't getting wider. It's getting denser.
In 2018, 1 in 100 workers crossed a state line for work. By 2025 it's nearly 1 in 60 — at companies whose state filing footprint actually shrank.
By Greenshades • 2026
- 153M+ paychecks analyzed
- 450K+ tax filings
- 2018 – 2025
About this analysis
This analysis draws on payroll and tax filing data processed through the Greenshades platform from 2018 through 2025, covering 153 million+ paychecks across staffing, healthcare, industrial, food service, government, nonprofit, and other sectors — running payroll across ecosystems including Microsoft Dynamics, Avionte, Aqore, and others.
Two questions drove the research:
- How has the relationship between employer state footprints and per-employee complexity changed since 2018?
- Which industries and geographies are driving the shift?
Section 01 — What the data shows
Complexity is rising inside footprints that haven't changed
The standard way to measure multi-state payroll exposure is to count states — how many does the company operate in? For most of the last decade, that was a reasonable proxy. The data suggests it no longer is.
Between 2018 and 2025, the average employer's filing footprint shrank. By every conventional measure, the compliance burden should have gotten lighter. Instead, per-employee multi-state exposure nearly doubled.
The complexity gap
The number of states companies filed in stayed flat. The workforce complexity didn't.
Average states filed per employer
Avg number of states where employers filed payroll taxes, 2018–2025
| Year | Value |
|---|---|
| 2018 | 9.3 |
| 2019 | 6.5 |
| 2020 | 6.5 |
| 2021 | 6.8 |
| 2022 | 6.6 |
| 2023 | 6.2 |
| 2024 | 6.2 |
| 2025 | 6.3 |
Per-employee multi-state rate
% of employees with wages subject to tax in more than one state
| Year | Value |
|---|---|
| 2018 | 0.9% |
| 2019 | 0.6% |
| 2020 | 1.2% |
| 2021 | 1.4% |
| 2022 | 1.4% |
| 2023 | 1.2% |
| 2024 | 1.3% |
| 2025 | 1.7% |
The two charts above tell the story in full. The left shows the conventional metric — employer state filings — declining over time. The right shows what was actually happening inside those footprints: more workers, at the same companies, crossing state lines.
Section 02 — The geography
The makeup of multi-state work is shifting compliance obligations
Which state-line crossings concentrate the most multi-state wages has changed significantly since 2018. The corridors with the highest volume today are concentrated in Midwest and Plains metro-area border markets — and each one carries different compliance implications.
Some adjacent-state pairs have no reciprocity agreement, meaning withholding is required in both states simultaneously. Others run through metro areas that straddle a border, adding local tax jurisdictions on top of state-level obligations. Some corridors are asymmetric — one state has an income tax, the other doesn't — which changes what's owed and where.
2018 top corridors
- CA–TX557
- LA–TX549
- NJ–PA448
- MS–TN351
- OK–TX317
2025 top corridors
- IL–WI +2,232%1,726
- KS–MO +357%933
- NM–TX +1,142%708
- IA–NE +300%632
- IL–IN +139%373
Count of employees who had wages subject to tax in both states in the same year. Percent increase reflects 2018 to 2025.
These aren't edge cases. They're the corridors where employees are most likely crossing, and where a compliance program built on state registration counts alone is most likely to miss something.
Section 03 — Industry patterns
The shift isn't uniform across every industry
Multi-state exposure is rising in most industries, but the pace and direction vary significantly. Technology & Business Services is the only industry moving in the opposite direction — and that exception turns out to be its own version of the story.
Multi-state exposure by industry
Percentage of employees with wages subject to tax in more than one state, 2018 vs. 2025
| Industry | 2018 | 2025 | Trend |
|---|---|---|---|
| 1.8% | 3.4% | ↑ Rising | |
| 1.6% | 2.2% | ↑ Rising | |
| 0.8% | 0.8% | → Stable | |
| 0.1% | 0.8% | ↑ Rising | |
| 1.7% | 0.7% | ↓ Declining | |
| 0.1% | 0.4% | ↑ Rising | |
| 0.3% | 0.3% | → Stable |
Select an industry to see the analysis
HR & Staffing
Staffing is operating in a different multi-state universe. At 3.4%, the rate is nearly double the next-highest industry — and it's been rising since 2018 even as the average filing footprint dropped from 27 states to 12.5. Fewer states on paper, more workers crossing lines in practice. That's the staffing version of the same paradox driving this whole report.
Industrial & Trades
Rose from 1.6% to 2.2% — a meaningful increase driven by project-based workforce deployment in construction and infrastructure. The average employer files in 6.3 states, and the corridor data shows exactly where that work is concentrated: IL–WI, IA–NE, and KS–MO are all industrial labor markets where cross-border project work has grown sharply.
Education
Holds steady at 0.8% — virtually unchanged since 2018. School systems operate within defined geographic boundaries, and remote instruction doesn't typically trigger multi-state wage obligations unless faculty physically work across state lines.
Government & Nonprofit
The steepest relative increase in the data — from 0.1% to 0.8%, an 8× rise over seven years. The likely driver is expanded nonprofit field operations across state lines and remote work arrangements that now span state boundaries. Traditional government employers remain largely single-state, which keeps the average filing footprint low at 1.7 states despite the rising per-employee rate.
Technology & Business Services
The only declining industry in this data — from 1.7% in 2018 to 0.7% in 2025, even though the average employer still files in 7.2 states. The footprint stayed wide but workers stopped physically crossing those lines. Remote work shifted the compliance risk from where workers live to where they log in — a different set of questions around nexus and remote worker rules that payroll systems handle differently.
Food, Hospitality, & Entertainment
Grew from 0.1% to 0.4% — still low by any measure, but the trend is upward. Hospitality has been climbing fastest within this group, likely reflecting the expansion of regional event and venue operations that require cross-border staff deployment.
Healthcare
Remarkably stable at 0.3% across the full period, with an average filing footprint of just 1.7 states — one of the smallest in the data. Despite the traveling nurse narrative, the healthcare employers here skew toward regional health systems and physician groups. Multi-state travel placement tends to flow through staffing agencies, which appear under HR & Staffing in this data.
The bottom line
Complexity follows the workforce now, not the footprint
For payroll teams, the compliance environment is genuinely harder than it was in 2018 — not because of decisions made at the leadership level, but because of how work itself has changed.
The companies in this data aren't expanding into more states. Their average filing footprint actually shrank between 2018 and 2025. But the share of employees earning wages across state lines nearly doubled over the same period — on the same company populations, controlling for mix.
Payroll complexity isn't a function of how many states you operate in anymore. It's a function of how your workforce moves within whatever footprint you already have. The pressure is real, it's measurable, and it's not going away.
Methodology
Data sources
Source: Greenshades platform payroll and tax filing data, 2018–2025. Covers full calendar years. Data is drawn from the Workspaces database (paycheck-level records) and the EFP Submissions database (state-level tax filing records). All figures are aggregated; no individual employee or company records are published.
Multi-state methodology
Two datasets were used:
- Dataset 1: a stable cohort of 464 companies with continuous data across the full measurement period. Used for per-employee multi-state rate trending — this removes the bias that would result from Greenshades' shifting customer mix over the period.
- Dataset 2: 708 companies with state-level EFP filing data. Used for corridor analysis and filing footprint trends.
Industry classification
Industry segments are sourced from CRM data and consolidated into eight reporting groups for this analysis. The "Other/Unknown" classification is excluded from all published figures. Industry classification is directionally reliable for trend analysis and not audit-grade.
Population caveat
The Greenshades customer population shifted over the study period, from approximately 2,300 workspace entities in 2018 to approximately 1,500 in 2025. The stable cohort methodology corrects for this mix bias in multi-state rate analysis. The 2018 filing footprint average (9.3 states) reflects a customer base that skewed toward larger, more multi-state-oriented employers; subsequent years include a broader range of company sizes.
What's not in this data
This analysis covers multi-state wage exposure and geographic filing patterns as measures of workforce mobility. It does not cover compensation data, headcount totals, revenue, or individual employee records. Findings reflect the Greenshades customer population and are not a random sample of all U.S. employers.