CWS 3.0: January 28, 2015

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Plan to grow your contingent workforce? Understand its components first.

Temporary staffing in the US is expected to grow 6% in 2015 according to the U.S. Staffing Industry Forecast by Staffing Industry Analysts. Buyers reported 18% of their workforce was contingent in 2014 and projected 20% will be contingent in 2016.

Other industry experts agree the US economy in general is poised for growth despite lingering worries in Europe and elsewhere.

“The employment trends index increased in every single month of 2014, capping the year off with strong growth, 2.3 percent, in the final quarter,” said Gad Levanon, managing director of macroeconomic and labor market research at The Conference Board. “The strengthening in the ETI suggests that rapid job growth is likely to continue throughout the first half of 2015. And as the labor market tightens further, acceleration in wage growth is soon to follow.”

This situation will drive companies to seek talent through all the channels available to them and that means contingent workers in all various shapes and sizes.

What plans do you have to grow your contingent workforce? The answer may depend on how you define and count it. Most experts agree that anyone who is not engaged as a regular employee by an organization can be considered contingent. So let’s revisit the formal definition of contingent workers from the Staffing Industry Analysts’ Contingent Workforce Lexicon of Terms:

Contingent Worker — Used to describe work arrangements that differ from regular/permanent, direct wage and salary employment. Contingent work and workers are primarily distinguished by having an explicitly defined or limited tenure.

  • Contingent workers include temporary employees provided by an outside staffing agency and independent contractors/consultants. Contingent workers may also include temporary workers from an internal pool, and others (such as summer interns, seasonal workers, freelancers, “crowd-sourced” workers, etc.) employed directly by an organization for an intentionally limited time period.

Based on this definition, are you counting everyone? Where does your company draw the line in the sand when it comes to flexible workers? Are internal temp pools used and do you count interns and freelancers?

  • From an employer point of view, contingent work also includes statement of work (SOW) consultants who work for the company on a short term basis. While the consultants themselves may or may not have an expectation of ongoing employment with their consulting firm, their work for the client is considered contingent.

Where do outsourced workers, PEOs and SOW workers fit in and when do you count them? 

  • Self-employed individuals should only be defined as contingent workers if they provide themselves as contract labor or SOW workers to other organizations. Otherwise, they should not be included in the contingent workforce, because they may have stable occupations or careers that are clearly not conditional or limited in tenure. Workers in professional employer organization arrangements are not contingent workers, because the relationship is by definition ongoing. Similarly, outsourced service workers would not be included in contingent work as this work is expected to have an ongoing rather than explicitly defined, short-term tenure.

The “contingent worker” label applies to all workers of any skill type or experience level who meet this definition, including those in professional, blue-collar, or office/clerical roles.

The idea is to have a strategy prepared for growth in 2015 and beyond. Growing interest in flexible workers and work arrangements by millennials, GenXers, baby boomers and smart companies is fueling demand for contingent workers. Make sure you know who is in your contingent workforce, what motivates them and how they fit it into your total talent management strategy.

Wondering what total talent management is? Check out this article Integrate total talent management business initiatives now and the latest SIA webinar Total Talent Management: 2015 - The Journey Continues and harness the potential of your contingent workforce as it grows in 2015 and beyond.

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