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HR anticipates that work done by contingents will increase by 179%

June 19, 2018

To combat skills and worker shortages, 91% of HR managers have begun adopting more agile talent strategies, according to the 2018 Future Workforce HR Report released today by Upwork. The majority, 70%, are already utilizing flexible or contingent talent, including freelancers, temp, and agency workers. And HR managers anticipate that work done by contingents will increase by 179% in the next 10 years.

In addition, 79% of HR managers surveyed reported their company’s utilization of freelancers has changed over the past three years. Nearly half of companies, 48%, are currently using freelancers —up 43% from 2017 — and four-times more hiring managers expect their usage of freelancers to increase in 2018 than those who expect it to decrease.

“With more jobs than people to fill them, companies are struggling to find the talent they need to get work done,” said Zoe Harte, senior VP of HR and talent innovation at Upwork. “New skill requirements and occupations are emerging as the half-life of skills continues to shrink. As work continues to evolve, companies will no longer align around job descriptions themselves, but rather projects, skills and capabilities.”

Nine out of 10 hiring managers are open to working with freelancers rather than making temporary hires through a staffing firm.

Earlier this month, the US Bureau of Labor Statistics released a separate report on the number of independent contractors in the US. It said independent contractors as a percentage of the US workforce fell between 2017 and 2005. However, several raised questions and concerns about how the BLS was measuring independent contractors.

Additional findings from Upwork’s report include:

  • Talent is increasingly hard to find: Nearly three times as many HR managers felt hiring had gotten harder in the past year versus those who felt it had gotten easier. The skills gap is forcing HR teams to think beyond their traditional workforce. Sixty-two percent of HR managers cited talent shortages as the top driver for embracing a more flexible workforce.
  • Headcount continues to rise: Last year, 96% of HR managers had open positions, and 66% plan to further increase their headcount in 2018. Headcount is expected to increase by an average of 19%.
  • Skills are becoming increasingly specialized: Skills are expected to change rapidly. Over three-quarters of HR managers, 78%, agree that skills will become more specialized, while 61% predict that the majority of jobs done today will not exist in the next 10 years. As new technological innovations emerge, 69% of HR managers agree that companies will need to invest in reskilling to prepare workers for the jobs of tomorrow.
  • Freelancers specifically will be leveraged with greater frequency: Because freelancers are often equipped with the specific skill sets teams require and are well-suited for the increasing volume of project work, more than half of HR managers, 59%, opted to utilize freelancers last year. Of these, 57% expect to use even more freelancers in the next 10 years.
  • HR is easing hiring difficulties by leveraging flexible teams: HR managers that utilize freelancers were more than twice as likely to say that hiring had gotten easier in 2017, compared to HR managers who don’t report using freelancers.

The study is based on an online survey conducted by independent research firm Inavero. The survey included 1,005 workforce hiring decision makers, including more than 200 small-business managers, and was conducted from Nov. 8 to Nov. 15, 2017.

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