Unlocking Business Success: Leveraging the Power of Contingent Workers
Posted on June 21st, 2023 Read time: 4 minutes
Contingent workers are playing an increasingly influential role in today’s business world. Their skills are extensive, and they provide organizations flexibility in multiple ways, offering expertise, stability, and even help launching initiatives. In 2023 and beyond, employers must understand who these workers are and how they can help their businesses both survive and thrive.
What Does ‘Contingent Worker’ Mean?
The size of the contingent worker pool and its characteristics might be surprising. Companies hire contingent workers during as-needed periods for a variety of reasons. Those needs can vary from filling in for an employee on medical leave to spearheading a special project. Consequently, contingent workforce staffing can look quite different from organization to organization.
Freelancers, gig workers, consultants, independent contractors, and outsourced talent all fall under the umbrella of “contingent workers,” and what they mean to a company is dictated by that company’s specific needs. These workers are not all interchangeable, and their skill sets and experiences vary enormously.
Contingent Workers Have Unique Skill Sets and Experiences
Contingent workers often have significant skills and experiences. For example, 44% of the contingent workforce has a bachelor’s degree, compared to 41% of noncontingent workers. Therefore, employers who seek out contingent workers might find talent not present in the traditional labor market. These workers could have the same skills as conventional employees — or better — but simply want different work experiences.
By expanding their search processes, employers can gain competitive advantages just by seeking nontraditional workers. However, it’s not always the case that these workers are career contingent workers — a great source of contingent work talent might already be on the company payroll and looking for new opportunities.
In addition, contingent work can keep talent from retiring. The United States is experiencing a significant wave of retirements from the Baby Boomer generation. By 2030, all Baby Boomers will be 65 years old or older. Rather than fully retire, many of these people would like to simply scale back work hours and obligations. Employers can benefit immensely from maintaining strong relationships with these workers, keeping their expertise and institutional knowledge. Retaining these team members is valuable when searching for new hires to fill specific workforce skills gaps. The value of exploring these arrangements is huge to companies looking to maintain continuity.
Workforce Gap Issues: Contingent Workers as a Solution
Contingent workers provide a potent business planning tool because they help address both opportunities and challenges. Business leaders are trying to decide what to expect economically: At the end of 2022, two-thirds of large company CEOs expected worsening conditions in the coming months, while two-thirds of midsize company CEOs expected improvements. Contingent workers can provide solutions that adapt to either positive or negative business environments. Even if an organization is expecting an economic downturn, contingent workers can still help achieve business goals and could be less expensive to onboard than a new employee.
Here are some more ways savvy companies are using contingent workforce staffing:
Contingent workers for growth
Growth is simultaneously a thrilling and daunting prospect. While any company would love to grow its revenue and client base, ironing out the logistics is challenging: Does the current staff have the capacity and/or expertise? Are existing services going to suffer? Wise businesses anticipate these challenges, and one of the best solutions is to use contingent workers. For example, companies looking to explore and develop new products can get a huge benefit by hiring contingent workers. These workers can start the new project while employees continue working on their current projects.
Companies looking to develop new products are having a challenging time finding scientists for research and design. This is a difficult position because traditional hiring and onboarding can take months, while hiring contingent workers can speed up the process. Some of these workers have sought-after skills — in STEM fields, for instance — and can provide a solution to companies that might only need those skills for certain projects. A company can explore the product line without having as much front-loaded risk in an employee and maintain flexibility with contingent workers.
Planning for the worst
Businesses must plan for the downsides as well as the upsides. With 67% of organizations experiencing or planning hiring freezes, there is a clear feeling that some downside might materialize. Contingent workers can help soften the blow for organizations by allowing employers to quickly react to the ebbs and flows of their businesses. During hiring freezes, contingent workers can quickly be brought on to minimize costs and maintain productivity, and when growth accelerates, they can provide stability while long-term hiring ramps up.
In 2023 and beyond, 80% of executives plan to hire more contingent workers than ever before. In today’s uncertain world, a highly adaptable talent pool is necessary for businesses to continue to thrive. Employers should really prepare to implement this workforce into their talent pools if they aren’t already doing so.
How Can Organizations Maximize the Contingent Workforce?
Collaborate across departments
Companies should have those working on budgeting and business planning collaborate with human resources and talent acquisition to consider the needs from both procurement and strategic points of view. By taking a more long-term view of how contingent workforce staffing can aid their businesses, leaders can maximize their hires’ impact. For example, Dolby has implemented an elastic talent manager to align the best contingent workers with hiring needs quickly — a model other companies can look to build upon.
Recruit for contingent talent
Organizations cannot assume that talent will always be available. Talent acquisition needs to intentionally focus on maintaining a pool of talented contingent workers and maintaining those relationships.
Include your contingent talent
Businesses need to be inclusive of their contingent talent and give them positive experiences in the workplace. Offer these workers meaningful training and learning experiences, invite them to functions, and create an environment where they are encouraged to share ideas.
Contingent workers are a vital piece of today’s business environment, and the companies that recognize that dynamic — and intentionally incorporate these workers — will be poised to succeed in the coming years.
If you’re interested in implementing contingent workers into your company, contact us today.
Written by: Tania Fiero, Chief Human Resources Officer at IES
Tania Fiero is the chief human resources officer of Innovative Employee Solutions (IES), a leading provider of remote and contingent workforce solutions, specializing in global Employer of Record, Agent of Record, and Independent Contractor compliance services in 150+ countries. Founded in 1974, IES is a woman-owned business, certified by the WBENC, and partners with companies to provide compliant employment solutions that empower people’s lives.
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Posted on June 21st, 2023 Read time: 4 minutes
Contingent workers are playing an increasingly influential role in today’s business world. Their skills are extensive, and they provide organizations flexibility in multiple ways, offering expertise, stability, and even help launching initiatives. In 2023 and beyond, employers must understand who these workers are and how they can help their businesses both survive and thrive.
What Does ‘Contingent Worker’ Mean?
The size of the contingent worker pool and its characteristics might be surprising. Companies hire contingent workers during as-needed periods for a variety of reasons. Those needs can vary from filling in for an employee on medical leave to spearheading a special project. Consequently, contingent workforce staffing can look quite different from organization to organization.
Freelancers, gig workers, consultants, independent contractors, and outsourced talent all fall under the umbrella of “contingent workers,” and what they mean to a company is dictated by that company’s specific needs. These workers are not all interchangeable, and their skill sets and experiences vary enormously.
Contingent Workers Have Unique Skill Sets and Experiences
Contingent workers often have significant skills and experiences. For example, 44% of the contingent workforce has a bachelor’s degree, compared to 41% of noncontingent workers. Therefore, employers who seek out contingent workers might find talent not present in the traditional labor market. These workers could have the same skills as conventional employees — or better — but simply want different work experiences.
By expanding their search processes, employers can gain competitive advantages just by seeking nontraditional workers. However, it’s not always the case that these workers are career contingent workers — a great source of contingent work talent might already be on the company payroll and looking for new opportunities.
In addition, contingent work can keep talent from retiring. The United States is experiencing a significant wave of retirements from the Baby Boomer generation. By 2030, all Baby Boomers will be 65 years old or older. Rather than fully retire, many of these people would like to simply scale back work hours and obligations. Employers can benefit immensely from maintaining strong relationships with these workers, keeping their expertise and institutional knowledge. Retaining these team members is valuable when searching for new hires to fill specific workforce skills gaps. The value of exploring these arrangements is huge to companies looking to maintain continuity.
Workforce Gap Issues: Contingent Workers as a Solution
Contingent workers provide a potent business planning tool because they help address both opportunities and challenges. Business leaders are trying to decide what to expect economically: At the end of 2022, two-thirds of large company CEOs expected worsening conditions in the coming months, while two-thirds of midsize company CEOs expected improvements. Contingent workers can provide solutions that adapt to either positive or negative business environments. Even if an organization is expecting an economic downturn, contingent workers can still help achieve business goals and could be less expensive to onboard than a new employee.
Here are some more ways savvy companies are using contingent workforce staffing:
Contingent workers for growth
Growth is simultaneously a thrilling and daunting prospect. While any company would love to grow its revenue and client base, ironing out the logistics is challenging: Does the current staff have the capacity and/or expertise? Are existing services going to suffer? Wise businesses anticipate these challenges, and one of the best solutions is to use contingent workers. For example, companies looking to explore and develop new products can get a huge benefit by hiring contingent workers. These workers can start the new project while employees continue working on their current projects.
Companies looking to develop new products are having a challenging time finding scientists for research and design. This is a difficult position because traditional hiring and onboarding can take months, while hiring contingent workers can speed up the process. Some of these workers have sought-after skills — in STEM fields, for instance — and can provide a solution to companies that might only need those skills for certain projects. A company can explore the product line without having as much front-loaded risk in an employee and maintain flexibility with contingent workers.
Planning for the worst
Businesses must plan for the downsides as well as the upsides. With 67% of organizations experiencing or planning hiring freezes, there is a clear feeling that some downside might materialize. Contingent workers can help soften the blow for organizations by allowing employers to quickly react to the ebbs and flows of their businesses. During hiring freezes, contingent workers can quickly be brought on to minimize costs and maintain productivity, and when growth accelerates, they can provide stability while long-term hiring ramps up.
In 2023 and beyond, 80% of executives plan to hire more contingent workers than ever before. In today’s uncertain world, a highly adaptable talent pool is necessary for businesses to continue to thrive. Employers should really prepare to implement this workforce into their talent pools if they aren’t already doing so.
How Can Organizations Maximize the Contingent Workforce?
Collaborate across departments
Companies should have those working on budgeting and business planning collaborate with human resources and talent acquisition to consider the needs from both procurement and strategic points of view. By taking a more long-term view of how contingent workforce staffing can aid their businesses, leaders can maximize their hires’ impact. For example, Dolby has implemented an elastic talent manager to align the best contingent workers with hiring needs quickly — a model other companies can look to build upon.
Recruit for contingent talent
Organizations cannot assume that talent will always be available. Talent acquisition needs to intentionally focus on maintaining a pool of talented contingent workers and maintaining those relationships.
Include your contingent talent
Businesses need to be inclusive of their contingent talent and give them positive experiences in the workplace. Offer these workers meaningful training and learning experiences, invite them to functions, and create an environment where they are encouraged to share ideas.
Contingent workers are a vital piece of today’s business environment, and the companies that recognize that dynamic — and intentionally incorporate these workers — will be poised to succeed in the coming years.
If you’re interested in implementing contingent workers into your company, contact us today.
Written by: Tania Fiero, Chief Human Resources Officer at IES
Tania Fiero is the chief human resources officer of Innovative Employee Solutions (IES), a leading provider of remote and contingent workforce solutions, specializing in global Employer of Record, Agent of Record, and Independent Contractor compliance services in 150+ countries. Founded in 1974, IES is a woman-owned business, certified by the WBENC, and partners with companies to provide compliant employment solutions that empower people’s lives.
