Today, diversity includes more than the characteristics of the people who work in our organizations. It also includes the arrangements under which they work. Increasingly, people are choosing contingent work — temporary work that may be project-based or time-based — over full-time or part-time employment. Temporary placement service provider Adecco predicts that the rate of growth in contingent workers will be three to four times that of traditional workforces, and that contingent workers will soon make up about 25 percent of the global workforce.
One reason for the increasing popularity of contingent work is involuntary: not everyone can find full-time employment. But intriguingly, more and more people are choosing a contingent work style.
Some workers say they seek better work-life balance; others want to create or design their own careers by focusing on specific work or projects that build and use a unique set of skills. Contingent employment also can expose individuals to a broad variety of challenges, providing constant learning and new skills and making work more interesting.
Often, contingent workers say dissatisfaction with their full-time employment experience convinced them to strike out on their own. Research published by Rosalind Bergemann in 2010 found 74 percent of workers who voluntarily chose to become independent cited a lack of engagement as their principal reason for leaving.
New technologies and services aimed at contingent workers make it easier to operate independently. Talent brokers such as YourEncore, an online network of retired and veteran scientists and engineers, or InnoCentive, which offers crowdsourcing services to companies with innovation challenges, connect free agents with project-based work in virtual marketplaces.
The lack of health and life insurance and disability benefits has been a major, ongoing deterrent to contingent work in the United States, but even that situation is changing. Insurance and other benefits can be obtained from organizations such as the National Association for the Self-Employed at competitive rates. And in countries with national health care, such as the U.K., the popularity of contingent work arrangements is soaring.
For corporations, using contingent workers as one component of the workforce can provide substantial advantages, including:
Cost flexibility: Not only can organizations derive cost savings from adjusting staff sizes based on business requirements, they can control the wages paid for particular tasks by hiring contingent talent on a project basis.
Speed and agility: Talent needs can change on a dime. New technology or new competitors can expose talent gaps in any organization. Employing a contingent talent strategy enables a company to access the right talent to meet specific skill or competitive challenges quickly, without incurring longer-term costs or disrupting the organization.
A boost to innovation: Contingent workers can add to an organization’s intellectual capacity and provide instant expertise as needed. They bring in new knowledge and fresh ideas based on experiences outside of the company or even the industry. Companies that have programs or processes in place to facilitate knowledge and expertise transfer from contingent workers to full-time workers capture that knowledge on a permanent basis. If contingent workers’ roles involve moving across the organization, they can share best practices across organizational boundaries more easily than internal employees.
To take full advantage of this emerging cadre of workers, businesses need to develop strong processes to identify and incorporate fractional workers. Corporations should redefine the scope of HR’s responsibilities. Increasingly, HR will need to serve a central staffing function, providing a home base for a workforce connected through increasingly varied arrangements — attracting, tracking, developing and orchestrating this complex talent corps, connecting the right people with the next challenging job.
Contingent workers bring unique experiences, fresh thinking and new approaches to the workplace and provide an important opportunity for talent-hungry corporations. Abandon the idea that contingent workers are simply an economic play. Tap the contingent workforce as an essential part of your talent strategy.
Tamara J. Erickson is the author of four books, including What’s Next, Gen X?, and is the founder and CEO of Tammy Erickson Associates, a business consulting firm.