This article is based on a recent panel webinar (watch the recording here) featuring our Solutions Consultant Irene Koulianos. This webinar was in partnership with Atrium and Ardent Partners to discuss the future of the extended workforce and how to scale your use of contingent labor.
When it comes to rebuilding your organization, from both a labor and scalable income perspective, a contingent workforce is a key component. Throughout the events of the global health crisis, we have seen organizations and individuals greatly adapt to the challenges at hand.
While 10-15 years ago, contingent labor existed primarily in the form of contractors and temps, the definition of the extended workforce has grown significantly.
But how do we define the extended workforce? Today, we can consider the extended workforce to include temps, freelancers, contractors, gig workers, talent pool candidates, professional services, and other forms of non-employee talent.
The Rise of Contingent Labor
After the 2008/9 financial crash, we saw a steep rise in contingent labor being used by a huge range of organizations. Although that level eased off as the global economy stabilized, last year saw a further rise in the gig economy. In their 2020 report ‘9 Future of Work Trends Post Covid-19’, Gartner stipulated that 32% of organizations were replacing full-time employees with a contingent workforce. On the panel, we discussed the possibility that this may even escalate to 40-50% once the pandemic is over.
RELATED READING | ‘The Rise of the Gig Economy: What Is It and Why Should I Care?’
How to Optimize Your Contingent Labor Program
When you’re optimizing your contingent labor program, there are three main things you need to focus on: flexibility, diversity, and technology.
1) Flexibility and Adaptability
If we’ve learned anything from the last year, it’s that flexibility is paramount to success. The recruitment and staffing industries have, historically, been fairly rigid in their practices, with a constant focus on regulation at the cost of innovation or doing things differently.
We don’t have to look very far to see how we’ve all adapted. Take kids for example, who have adapted overnight to learning online. While this has been hard, and teaching and parenting alongside full-time work have been a struggle for many, this shows a great deal of flexibility and adaptability.
This last year has shown us that we can remain fully compliant and uphold regulatory standards while taking a different approach. The necessities of fully remote hiring and onboarding processes broadened the understanding of how we can work. There has also been a huge potential for growth in diversity and accessibility within the contingent staffing industry.
MORE FROM THE BLOG | ‘Coping with COVID-19: How the Pandemic Has Shaped the Contingent Workforce’
2) Diversity and Accessibility
Diverse teams function better and companies with a diverse workforce (especially in more senior roles) are often more profitable. Diversity isn’t simply a tick-box exercise—it needs to be something an organization strives towards every day. Affecting real change takes a lot of consistent effort and organizations can’t simply be performative about it.
Throughout the pandemic, for example, women have been most negatively impacted, with women of color and minorities taking the biggest hit. Women make up 39% of the total workforce but account for 58% of total job losses throughout the pandemic. Some sources suggest that this has set us back as much as three decades in terms of women’s representation in the workplace.
For years, organizations have been nervous to extend their diversity, equality, and inclusion (DE&I) focus into their contingent labor due to concerns over co-employment. Historically, as mentioned in the panel, the only thing you’d look for in terms of diversity in a contingent workforce was spend. Diversity was more a procurement function than anything else. Now, however, companies are keen to build more diverse talent pools and understand how they can track DE&I in the contingent workforce space.
Flexibility plays a huge role in diversity and accessibility as well. It has often been the case that contingent workers, due to the nature of their relationship with a given organization, weren’t offered the same flexibility as full-time employees. For example, some organizations may have strict absence policies which are more likely to impact a single parent or someone with a disability who needs regular medical attention. This flexibility (or lack thereof) can come out of unconscious bias, so it’s important to examine how flexible your extended workforce programs are—do all roles offer the same levels of flexibility? If not, are there additional accommodations you can provide?
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3) Technology and Automation
Automation can save you a huge amount of time and money, so is vital to the scaling process. Using a vendor management system and other integrated technologies not only allows you to become more efficient, it also keeps you more aware and educated about your own current and/or prospective contingent workforce.
Taking manual processes and automating them considerably speeds things up and removes human error from the equation. Creating a talent technology ecosystem will help you to manage your contingent and full-time labor in one place and improve your overall talent management.
RELATED READING TO DOWNLOAD TODAY | ‘Talent Without Borders: Using Technology to Build a Talent Ecosystem’
Another major benefit of bringing more technology into your extended workforce management is the data that it provides. You will have a much clearer insight into which vacancies have a high turnover, which contingent workers get consistently positive or negative feedback, any red flags for vendors, suppliers, or workers.
All of this will help the overall management of your contingent workforce in a way that is sustainably scalable.