14 January 2022

How to Maximize the Value of Your Contingent Workforce

3 min read

Consultants, temporary workers, project-based workers, contractors and gig workers. All of these are different labels for any worker that falls under the contingent category, and isn’t classified as an employee.  

According to research from Ardent Partners, these workers make up around 47 percent of a company’s total workforce. That percentage is expected to grow even further over the course of the next few years.

Contingent workers are no longer reserved for administrative work and seasonal help, their skillset has grown to include long-term projects, consultancy roles and industry expertise. Contingent workers can help organizations to augment their existing employees with new skill sets, expertise and strategic thinking. 

With contingent workers now playing such an important role in filling your workforce requirements, it’s more important than ever that you don’t underestimate them.

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With that in mind, let’s take a look at some ways in which you can maximize your use of the contingent workforce. Before we get into that, however, let’s first discuss why these non-employee workers are so important to so many businesses.

The growing importance of the contingent workforce

The contingent workforce offers businesses a range of benefits from improved flexibility, cost savings, the ability to access talent despite the workforce shortage and so much more.

Here are just a few reasons why the contingent workforce is so important for businesses right now:

Cost savings

Full-time employees cost a lot of money from hire to retirement. And the hiring process is expensive as well. Contingent workers give organizations the opportunity to hire skilled and experienced workers, and pay them for the job they do and the time that it is needed. 

Acquire the top talent in your industry

Workforce shortages are having a huge impact on companies' current ability to fulfill their requirements. The contingent workforce can give businesses a competitive edge over others in their industry, improving their access to skilled, experienced and ready-to-go talent.

Flexibility to scale your workforce up or down rapidly

What a business needs today isn’t necessarily what they need tomorrow. Contingent workers are sourced as-and-when they are needed, giving businesses the ability to scale their workforce up and down at a moments notice when required. 

Faster hiring times

The average hiring time for full-time employees is somewhere in the region of 23 to 42 days. That’s a huge amount of time when you have a position to fill. The contingent workforce helps decrease time-to-hire, with talent that you can place into your organization with short notice. 

Factors that will help you maximize your contingent workforce

With contingent workers now contributing to the success of a business more than ever more, it’s important that organizations revisit, review and refresh their contingent workforce management programs.

With that in mind, here are a few factors to consider that will help your business maximize its use of its non-employee workforce.

✔️ Set up a contingent workforce management program

A contingent workforce management program is crucial to the success of your externally-sourced workforce. No longer can companies rely on time-consuming, manual spreadsheets that give them no real visibility or control over their non-employee workers and staffing agencies. 

Instead set up a proper contingent workforce program. If you want to manage this internally then invest in a Vendor Management System (VMS), or if you want to outsource this program to an expert then consider using a Managed Services Provider (MSP).

✔️ Analyze the performance of your staffing vendors

It’s likely that your business is using staffing agencies to source your contingent workers, but do you know how these vendors are performing? Analyzing their performance is key to understanding the ROI of your contingent workforce program.

Track important insights such as turnover, time-to-fill and fill rate. This will give you a better idea of how your staffing agencies are performing, and help you understand the ROI of your current contingent workforce program.

✔️ Forecast your future workforce needs

The contingent workforce should align with your organization’s overall talent strategy. Establish a baseline for future contingent workforce needs and forecast how many externally-sourced workers you might have to source to achieve your business goals.

By projecting your future contingent workforce needs, you’ll be able to analyze whether your current pool of staffing vendors have the capabilities to meet those needs.

✔️ Automate where you can

Your business might not have the time and resources necessary to complete all of the processes associated with contingent workforce management. That’s where automation comes in.

Use a vendor management system to support your contingent workforce hiring and management activities. The use of a VMS will automate and streamline all of the processes around managing your staffing agencies and contingent workforce, giving your HR or procurement team more time to spend on higher-value tasks.

Interested in learning more about how you can maximize the value of your contingent workforce? Get in touch with Contrax today. We would love to help you do just that.

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