Calculating ROI of Using Contractors

An increasing number of companies today are relying on independent professional talent for their skilled expertise and on-demand availability. Independent professionals bring many benefits to the table including an effective way to reduce costs, drive product innovation, and expand a company’s pool of available skills. In fact, more than 60% of senior executives say their external workforce is important or very important in increasing organizational agility, increasing speed to market, and developing or improving products and services.

Independent professionals are giving businesses a valuable competitive advantage in today’s increasingly project-based economy. Below, we explore three ways incorporating independent talent in your workforce can offer a substantial return on investment (ROI).

Availability of Skills That are Hard to Find in a Traditional Talent Pool

Companies are continuing to struggle to find workers who have the skills they need—67% of large organizations report having difficulty finding talent for their workforce. Today’s strong payroll jobs market and unemployment rate at a 50-year-low have created an environment where companies must compete for top talent. But recruiting the very best comes does come at a financial cost, as companies have to provide competitive benefits packages and other incentives in order to position themselves as an attractive place to work.

Independent talent can help to minimize these costs while giving companies access to the skills they are looking for. Independent professionals are a well-educated, highly-credentialed group that can bring the latest, in-demand skills to a company within their area of expertise. By incorporating independent talent in addition to traditional workers, enterprise managers can help to fill skill gaps in their workforce.

Tangible Cost Savings

As more companies reimagine their workforce to include a dynamic mix of salaried employees and independent talent, the cost of not capitalizing on this trend can be high—both from a competitive and financial standpoint.

Outsourcing talent on a project-basis can help minimize the price of traditional employment. An employee hired for their particular set of skills or to work on a specific initiative may become a burden to the company once the project they are working on is complete, or if their skills become outdated.
Independents, on the other hand, provide their services for a period of time outlined by a contract and tend to keep their skills up-to-date as the success of their business relies on their expertise.

And because independents operate as their own business, bringing everything needed to the client they engage with, HR teams don’t have to spend as much time on onboarding or training as they would with a traditional employee.

Improved Business Agility and Flexibility

Independent professionals allow companies to operate in a more agile and flexible way. With independent talent, companies can expand or contract their workforce as needed during busy times of the year, or if they want to investigate a new line of business, build out a larger team to support a long-term project, or figure out how to expand into a new market.

Incorporating independent talent can also bring a fresh, unbiased perspective to a problem or project. As experts in their industry, independents can pitch creative ideas or provide a different take on how to tackle a particular challenge.

To learn more about the ROI of independent talent, check out our misclassification risk calculator, or contact us today.