Contingent staffing and workers in the gig economy are an increasingly vital part of the global workforce. In fact, according to the Association of Independent Workers and the Self-Employed (IPSE), an estimated 4.8 million people in the UK are self-employed, contributing a staggering £217billion to the economy in 2017 alone. And this trend has long been noticeable across the globe. In the US, data from the Bureau of Labor Statistics puts this figure at 16.5 million gig-workers, and across the Asia-Pacific region, employers estimate that 30% of their overall workforce is contingent.
A challenging people strategy
However, for HR teams and hiring managers, working with this fluid talent pool presents significant challenges. Sourcing these candidates requires the same, if not more, work as a permanent hire. For those firms where a significant proportion of the workforce is contingent, this naturally puts greater pressure on HR. And, of course, engaging senior staff on a temporary basis creates an on-boarding headache as the need for them to be embedded quickly is crucial, but the quality of this process cannot slip for the sake of time. Then there’s the risks associated with relevant compliance, employment status and training checks of each of these individuals.
And once one contractor exits the business, the cycle begins again for a brand-new person.
Identifying wastage
This particular challenge has long been at the top of the workforce management debate. However, while many strategic workforce plans seek to address the attraction and retention of contingent staff, there’s one vital element that is often overlooked: the amount of talent ‘wastage’ in existing processes.
In many instances, firms utilising contract workers will have numerous projects or locations where this talent group will be needed. Take construction, for example. A business is likely to have multiple projects going on across the country or indeed the globe. But how well is employee information shared across these locations? For permanent staff, it’s likely that the business will have easily accessible information on employee numbers and where they are based. But for the contingent workforce, much of this information is likely to be held on site by the project manager.
The result is that hiring teams for the company could potentially be seeking talent needed for one project, without realising that the perfect individual is working on another site and their contract is about to end. Simple record keeping and complete transparency across the business could lead to this individual being relocated, rather than lost. Given that this approach will remove the need to invest in further external recruitment and the fact that the person will have already been onboarded with the firm, the savings can be immense.
The same can be said of compliance and right to work checks. Contractors will often have to repeat the same forms and processes time and again, when in fact this information may already be stored elsewhere in the business or even with a partner recruitment agency. By having complete transparency of this information, the hiring company’s time is reduced and, perhaps more importantly, the candidate experience is streamlined and improved.
Of course, that’s not to say that the entire solution to the management on this fluid workforce lies in simple adaptions to processes and greater transparency: the issue is much more complex than that. However, without the relevant foundations in place, the strategies that we’re building will simply break under the pressure of the expanding gig economy.
Don’t forget the money
And, of course, there’s the financial considerations. Reducing wastage in this process will, in turn, cut expenditure. With more contract staff being transferred across the business, less needs to be invested to attract and on-board these individuals. And with any relevant compliance checks already being completed, resources can be freed up.
As a case in point, a major facilities management client of ours saw a combination of admin reduction, reduced usage (through efficiency) and more competitive agency supply result in savings of £2.7m or 10% of their annual contingent workforce spend.
The future
Technology that can guarantee the most efficient use of an increasingly scarce resource pool of talent is likely to see widespread up take. As Paul Bolt, Chief Marketing Officer of Microsoft UK predicts: “As our economy increasingly leans towards an on-demand workforce, organisations face a daunting range of compliance, legislative and administrative challenges. Technology will be the driving force to realise the operational rigour and efficiencies these organisations seek and also provide a compelling, simplified user experience throughout the recruitment supply chain.”
