7 September 2022

Top 5 Things You Need to Know About Contingent Workforce Staffing

Wayne Burgess
Wayne Burgess

The workforce is changing. Organizations and employees alike are now taking advantage of both technology and new workforce models to meet their needs of increased flexibility and a better lifestyle.

Both skilled and unskilled workers are accepting flexible and contingent roles in what is becoming an increasingly “non-traditional” workforce. In fact, according to a US Government Accountability report, 40 percent of the US workforce is made up of contingent workers, with the average organization having 18 percent of their workforce employed on a contingent basis.

Contingent labor is providing huge benefits to organizations, allowing them to fill roles cost-effectively and quickly in what is now a hugely competitive industry. When managed correctly, contingent workers can save a business money, ensure they are more competitive in the job market and improve their access to top talent. 

In this blog, we take a look at the top five things you need to know about contingent workforce staffing. This information will help you build a  contingent workforce management program that drives ROI to your business. 

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1 - The contingent workforce requires strategic management

When managing contingent workers it’s a huge mistake made by many businesses to just lump these workers in with regular permanent employees and manage them all the same way. This leads to compliance risk, a complete lack of visibility over contingent workers and poor insight into how staffing agencies are performing.

Contingent workforce management requires its own, highly-strategic approach. A company-wide program will ensure all hiring managers are using the same vendors, at the same rates to hire the contingent workers that truly help your business to grow. Without a strategic program, that’s also underpinned by a vendor management system (a point we will get to shortly), your business will suffer from rogue costs, compliance and vendor risk, as well as rogue spend that hurts your bottom line.   

2 - There are both pros and cons of managing a contingent workforce

Contingent workers, or contractors, offer a range of benefits for today’s organization, from increased scalability to reduced labor costs. Some of the pros of contingent workers include: 

  • Staffing agencies offer faster hiring times than traditional routes.
  • Reduced labor spend.
  • Improved workforce quality
  • The ability to easier fill skills gaps
  • Improved scalability for peak demand or new projects.

While there are a range of pros that come with contingent workers, a mismanaged contingent workforce program can bring a range of cons for a business. These include:

  • A lack of control and oversight of contingent workers.
  • Potential misclassification of non-employee workers.
  • Company culture can suffer if businesses rely on non-employee workers. 

3 - Contingent workforce management requires technology

A vendor management system is key to the successful implementation and ongoing management of a contingent workforce program, ensuring organizations have visibility and control over their staffing agencies and contingent workers.

Businesses that try to manage a contingent workforce program without vendor management system technology suffer from inefficient operations, fragmented processes and no program standardization, which all lead to a complete lack of control and visibility over the program.

To learn more about what a VMS is and how it can help your business manage its contingent workforce, read our complete guide to what a vendor management system is

4 - Contingent workers are crucial to today’s businesses

Even if your business isn’t making the most of contingent workers, there’s no doubt that your competitors are. This means not only are they saving money by only paying for workers on an as-needed basis (improving their bottom line), but they’re accessing high-quality talent that your organization is likely failing to source. 

The contingent workforce is now essential to today’s organization, offering both highly in-demand skills such as IT or unskilled workers on an as-needed basis. Businesses that don’t take advantage of this workforce are likely being left behind. 

5 - Staffing agencies play an important role in contingent workforce staffing

While contingent workers can be sourced directly through a direct sourcing program, staffing agencies are typically essential to most company’s contingent workforce program. Staffing agencies work on behalf of companies, and job seekers, to match talented temporary workers to the skills and experience required for a specific position.

Choosing the right staffing agency, and managing them correctly, is a crucial component of contingent workforce success. Organizations must make sure they partner with the right vendors, which help them fill the right roles, at the right time and at the right price point. 

Are you interested in learning more about the contingent workforce and how your business can better manage it? Get a demo of the Conexis VMS platform today.

Contact Conexis VMS

Wayne Burgess

Wayne Burgess

Prior to starting Conexis, Wayne was a tireless champion for clients within Accenture’s Procurement practice with specific experience across the Services and Contingent Labour spectrum. Wayne has run programs from as small as $5m to as big as $2bn. Wayne has deep consulting and operational delivery experience. He is a talented leader of organizations and has a proven track record of driving significant customer value.

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