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Understanding the Contingent Workforce

Posted on July 21st, 2016 Read time: 3 minutes

By Jennifer Maynard, Human Resources Manager

As employers seek to make the workplace more flexible, there is an increasing need for work arrangements involving the contingent workforce.  Contingent employees may include temporary employees, part-time employees, on-call employees, consultants, seasonal employees and interns.

The Staffing Industry Analysts estimates that the average company’s contingent workers currently make up 18% of the total workforce.  The demographics within this population range from 18 to 80 years old.  It is a growing population and can be a great strategy for operating your business to maximize efficiency.

Hiring contingent employees at your workplace may help meet the needs of your business and may offer significant cost savings.  Here are some advantages to hiring contingent employees:

Maximizing Your Workforce 

  • By using the contingent workforce, you are able to hire as needed for projects or cyclical business needs.
  • Staffing is more flexible with the use of contingent workers because employers can hire quickly and adjust staffing levels as needed. These employees can step in as needed on short notice and allow you to be agile in today’s marketplace.
  • Contingent workers may provide a special skill set that doesn’t exist within your current employee pool.  By considering non-traditional employment relationships, you can bring in new expertise that can help grow your business.

Meeting the Needs of Changing Demographics of Workforce 

  • The concept of contingent workforce management is being reshaped by the gig economy – the growing trend where people take temporary, task-based work versus traditional employment.
  • Work-life balance continues to be a constant especially for working and single parents who need to work around child care or school hours.
  • Retirees are a great example of today’s contingent employee.  They may wish to work but within the limits of earnings imposed by Social Security so full-time employment is no longer a viable option.
  • Highly qualified and skilled employees who seek project based work and yearn for constant change are available through contingent workforce solutions.

Administrative Savings 

  • Employers understand the cost of onboarding and off-boarding employees.  Utilizing an employer of record provider will eliminate the administrative hassle and reduce the time you spend on the hiring process.  Additionally, employer of record companies will help with HR risk management by reducing risks, costs and complexity with hiring contingent employees.
  • There may be less training involved with a highly skilled contingent employee who is capable and familiar with your systems.
  • Employers who like the approach of temp to hire positions will gain confidence in their hiring decisions by using contingent workers.

Utilizing the contingent workforce successfully will allow your company to grow and achieve company goals.  Here are some tips to creating a successful contingent workforce solution.

Employee Engagement

  • Acknowledging and recognizing contributions by the contingent worker will build loyalty and engagement within your workforce.
  • Remember the contingent employee can be a great ambassador for your company – whether they are with you for a week or a year.   If they have a skill set you may need in the future, you’ll want them to want to come back!
  • Good communication and explanation as to how the role is supporting the strategic objectives of the team will allow the contingent worker to feel a part of the company’s overall mission.
  • Providing resources and support to the contingent employee just as you would your core employees.

Avoid Misclassifying Contingent Workers

  • Many employers jump to the conclusion that any contract worker can be categorized as an independent contractor.  Do your research and rely on experts that can help vet independent contractors and provide alternative contingent workforce solutions.

Flexible work arrangements benefit the economy by maximizing the workforce, meeting the needs of the changing workforce demographics and providing administrative savings.  Contingent workforce management will help companies access the best talent and improve business results.

An experienced employer of record company can help you avoid expensive issues that may arise with your contingent workforce.  Reach out to the friendly experts at Innovative Employee Solutions for further assistance.

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