The Contingent Workforce
With the US economy booming again, more jobs are being created, but the nature of employment is changing to more contingent contracts. Why are workers embracing this type of work and how can employers best manage the challenge of a contingent workforce?
The U.S. economy continues to grow despite some setbacks. In 2018 though there is a growing understanding that contingent workers (contractors, temporary employees, and freelancers) are playing an ever-increasing role. This represents a further shift in global employment patterns with an influx of 2 billion new workers into the global workforce from the BRIC countries in the past two decades. What this has led to is a change in the structure of employment needs in Western countries. Professions, such as medicine, that was once characterized by a great deal of security and worker protections are now morphing into far more temporary, contingent contracts.
The Gig Economy
This employment shift represents an opportunity for workers who wish to manage their working life themselves but it is a huge challenge for managers at the employer companies. The scenario in which HR departments and unit managers must juggle workers who are temporary, off-site, contracted or simply employed by someone else but doing that work on their work site is increasingly common. It is also something that is fiendishly difficult to control. Workers do not have the same sense of company buy-in when they are contingent and, in many cases, are totally unfamiliar with the company mission. If that is not challenging enough it is also the case that contingent workers are much more likely to experience a workplace accident as a result of unfamiliarity or lack of training. Finally, the influx of workers from so many disparate sources means accurate registration detailing and training records make compliance an ongoing issue for managers.
Why be a part of Contingent Workforce?
1. Flexibility
This is the key reason for workers to embrace contingent work. When the pressures of childcare or other commitments make a full-time position impossible the flexibility of being able to negotiate working hours is very attractive. It is not just hours that can be flexible but also work site location, in other words, the flexibility to complete project work from home can aid a work schedule.
2. The Free Agent movement
At an ideological level, many workers do not wish to be tied to any one employer. Being a free agent grants a sense of motivation that can be missing in fixed employment. It also gives a sense of control over one’s career path.
3. Challenge and variety
Professionals today want to make a difference and be challenged. Companies often use contractors to meet critical deadlines and complete projects, so it’s easy for individuals to see the impact of their work – and then move on to the next challenge.
4. Part-time retirees
For many people working part-time hours is the attraction. Those workers who are coming closer to the end of their working lives have a strong impetus to continue to earn money but still have greater amounts of free time. Contingent, consultancy or project-based work will often suit their needs better than continuing to work full-time or retire.
5. More money
Contract work or project work is usually better paid than direct hire work as the employer is not encumbered with administration, taxation, and responsibility to the same degree as they would have with employees. Many people are willing to forego the securities of being an employee for this greater earning potential.
How can you manage a contingent workforce better?
The reality for 2018 is that employers are struggling to communicate company vision to workers. They are also struggling to retain these workers on an ongoing basis. Loyalty is, unfortunately, not guaranteed for contingent workers who are not receiving benefits like direct employees. There is also the issue of contractor safety, particularly in heavy industries where many contractors work. As they spend so little time engaged directly with the company apparatus they can often be overlooked when it comes to training in workplace hazards.
1.Vet carefully
It cannot be overstated the value to a company of doing the vetting correctly. It is critical to get a contractor who has the skills and experience to hit the ground running. Using the same contractors repeatedly and building relationships with them will avoid the difficult business of finding new ‘fits’ for every individual project. What you are looking for is someone who understands the company values and has a background that is relevant to the work at hand.
2. Provide an orientation
Contingent workers might work off-site or they might have a very casual interaction with the company apparatus so laying out the company ethos and mission statement formally is an essential first step. A company orientation can be provided online with various forms of media or it can be conducted in person. Both have their benefits but the online options are gaining in popularity for companies as the technology to deliver these orientations improves. Do not assume contingent workers will intuit your company values and practices unless you are looking for a nasty surprise down the line.
3. Set clear goals
Outline milestones, expectations and deadlines for contractors in advance. Do it in writing ideally so there is a source document in the case of disagreement later. Budgets, pay rates and priorities are also key guidelines for a project that should be set up in advance. A regular catch-up daily or weekly is also good practice to avoid project drift.
4. Train them
Training is an employer’s most valuable tool in avoiding poor worker performance, low productivity and accidents at work. Providing project training and company safety training is a must for contract workers to ensure that the work is carried out correctly and safely. Workplace hazards are doubly hazardous if the worker is untrained and unfamiliar with the work site. Worker training should be the first thing on every HR manager’s list when considering hiring a temporary employee.
5. Integrate them
Treat contingent workers the same way that you treat direct employees. They are contracted for a reason, they are good at what they do and therefore, their human capital is of value to the organization as a whole. The more they are engaged with and integrated the more you will get out of them. Consider holding regular conference calls or Hangouts with other employees to facilitate idea sharing and community building. The future of economic employment patterns cannot be predicted with any certainty but for 2018 it appears that the contingent workforce will be playing a crucial role.
Conclusion
More companies are relying on a contingent workforce every year. The challenge for management is ensuring that these temporary workers are integrated and become safe, productive members of the workforce. In industries like construction and energy generation, the vast majority of workers are often contractors, so it’s imperative to have an efficient onboarding process in place. An online platform like GoContractor is the ideal solution for training and managing your contingent workforce. The intuitive course builder allows you to provide quality safety orientations, while features such as the traffic light system make it easy to manage worker behavior to ensure safety on-site. The biggest benefit is that shifting your contractor management online frees up your staff, saving your company time and money.
