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Companies shift strategies to compete for talent, 30% hire contingent labor: Cielo

October 05, 2018

Competition for talent is causing shifts in corporate strategy, according to the 2018 Talent Acquisition 360 study released today by RPO provider Cielo. It is also the source of disagreements among business functions regarding their companies’ approaches to talent acquisition.

“Although leaders in all of the business functions we surveyed now agree that retaining talent is a core business driver, they disagree on talent acquisition priorities, effectiveness, metrics for success and the role of technology and outsourced services to help them compete for talent,” said Cielo founder and CEO Sue Marks. More than 70% of C-suite leaders said they want to play a role in talent acquisition decisions, a clear indication of the increasing pressure to align talent acquisition and retention with business goals, according to Marks.

Cielo’s study found 30% of companies hire contingent labor across all job levels, including 24% of senior roles, 28% of manager level roles, 32% of individual contributors and 41% of entry-level talent. This contingent labor includes temporary employees, independent contractors, consultants, interim executives and gig workers. The proportion of contingent labor in the total workforce is significantly higher in Asia Pacific, Latin America and the Middle East than in the US, Canada and Europe, according to the report.

“There appears to be a rapidly growing trend as 65% of companies we surveyed said they expect flexible workers, contingent workers and project-based workers will take over a significant amount of the work currently being done by full-time employees,” said Marissa Geist, executive VP and managing director of the Americas for Cielo.

Other key finding from the survey include:

  • C-suite is the most optimistic: C-suite leaders are two times more likely than business leaders to think that their organization’s strategic talent acquisition priorities are highly effective and 20% more likely than HR leaders to believe they will play a key role in talent decisions in the future.
  • Technology implementation is not a priority: Only 10% of companies surveyed identified new technology implementation as a priority for talent acquisition. As the technology market evolves and solutions become more intuitive, HR is more focused on finding solutions that can help improve quality and experience and less focused on implementing that technology. These companies are often using partners for implementation and ongoing support.
  • Total talent acquisition is a priority for every stakeholder: Ninety percent of respondents believe that “Total Talent Acquisition” needs to be a priority for their organization. As the demand for contingent workers increases, this more holistic view of talent will help organizations prepare for the future and help to align all stakeholders under one common objective. Currently, 68% of HR leaders believe they have ownership over total talent acquisition, while 65% of procurement leaders believe they do.
  • HR and business are more closely aligned: Cielo’s 2015 research found a significant gap between how the business and HR perceived talent acquisition priorities. In 2018, the gap has narrowed as business leaders and HR leaders are more aligned in priorities, effectiveness, metrics and technology.
  • Diversity and inclusion programs need more support: Only about 20% of C-suite leaders rated diversity and inclusion a priority, likely because they are not always included in these conversations — making it difficult to implement strategies and get buy-in for solutions to support attracting, hiring and retaining a more diverse workforce.
  • Candidate communication falls short: Stakeholders identified candidate experience as one of the most important metrics for success, yet most companies fall short when communicating with candidates. Companies are either not providing the status to candidates during the application process, not following up during the hiring process, or relying solely on email as a form of communication. Only 1% of candidates surveyed indicated that they received a text from a recruiter during the hiring process, and only 50% of candidates said they heard back from a company “sometimes.”

The Cielo Talent Acquisition 360 study surveyed more than 1,100 C-level executives, HR leaders, procurement leaders and business leaders in North America, Europe, Latin America, the Middle East and APAC. The surveys were conducted in July and August 2018 and the companies included have 1,500 or more employees.

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