Employers’ protracted reliance on a non-employee workforce as the U.S. emerges from a severe recession is a marked change from past economic recoveries when employers would add temporary talent before transitioning to full-time employees.
“Historically, temporary employment has served as a bellwether for permanent hiring, but these findings suggest that something much more substantial is occurring to overall workforce composition,” says Lori Schultz, President of Yoh. “Employers are saying that the recent recession has fundamentally changed their employment strategies and led to a ‘just in time’ hiring strategy that will make temporary employees an even greater pillar of the American economy.”
Other significant findings from Yoh’s Annual Workforce Trends Study include:
- Since September 2008, 88.5 percent of business leaders said the size of their non-employee workforce has stayed the same or increased.
- Sixty-three percent of business leaders surveyed report significant investments in improving the management and effectiveness of its non-employee workforce segment. Some methods include increased employee engagement efforts, vendor consolidation, improved employee communication, and integrating temporary workers into teams in the organization.
- Survey results revealed a significant misalignment between organizational and business priorities. More than 70 percent of business leaders surveyed specified cost as the primary concern with non-employee use, a decision Yoh says minimizes the quality, value, impact, and integration of the temporary segment of the workforce. Accountability, independent contractor compliance, and co-employment risk ranked as the three lowest priorities.
These findings provide further insight into the state of the non-employee market. In fact, temporary employment has risen by 494,000 jobs since September 2009, according to the latest Bureau of Labor Statistics Unemployment Report.
“It is not uncommon to rely on temporary talent during difficult economic times,” says Adam Lawrence, Head of Global Sourcing at SAP. “However, this economic cycle has resulted in a more dramatic and permanent increase in contracted labor. I do not see the current levels of temporary talent decreasing in the near future.”
The transformation of the workforce composition will have significant implications for both employers and employees. Employers now have the flexibility to quickly adjust the size of their workforce depending on project load.
Employees, meanwhile, will have to overcome the stigma associated with “temporary talent.” Now that it’s here to stay, “temporary” workers might find themselves engaged in projects for longer periods of time, frequently transitioning into new opportunities and gaining access to jobs that were perhaps previously filled with full-time employees.
“Working on a contracted basis has given me diverse opportunities that I would not have been exposed to otherwise,” says Cecilio Rodriguez, a seasoned contract employee. “Lately, I’ve noticed an increased level of attention from employers toward their temporary staff, and it appears as though temporary employment is not as taboo as it once was.”
