How to Maximize the Potential of Your Workforce with Contingent Talent

By MBO Partners | June 6, 2024

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Key Points

To address talent scarcity, organizations are increasing their use of contingent labor.

Independent contractors can help enterprises improve their business flexibility and agility.

A blended workforce allows companies to scale up and down according to project needs and market changes.

Finding the right people for your workforce can be a tall order in today’s competitive talent landscape. To address talent scarcity, organizations are investing in automation solutions, doubling down on allocating resources to find and hire full-time employees for specific job descriptions, and investing resources into upskilling current employees. But most companies are tackling talent scarcity by increasing their use of contingent labor.

The Contingent Workforce Landscape

There are currently more than 72 million Americans working independently. Growing demand for these workers—coupled with an expanding supply of people pursuing independent work and enabling technology—has created an ideal landscape for the independent workforce.

Enterprises across the board have been faced with disruption, intense competition, and labor and skill shortages. For many, the answer to these challenges is a workforce that is more agile and flexible. The average company reports that contingent labor makes up 28% of their workforce, and that proportion is expected to grow to 38% by the end of 2027. More people are choosing to become full-time independent workers, drawn by the autonomy, control, and flexibility independent work provides. In turn, this opens the door to more skilled talent that enterprises can engage to improve their business flexibility and agility.

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Workforce Optimization

As enterprises begin to think more strategically about how to optimize their workforces, they are also shifting the way they think about talent. For example, rather than building a traditional workforce that incorporates full-time employees who each have a specific role, companies today are building more dynamic workforces that incorporate both full-time and independent talent.

This increases the type of skills companies can access, boosts experiential diversity, and allows hiring managers to build small teams to tackle specific projects or tasks. By increasing their use of independent labor, organizations can more fully optimize their workforce and remain agile.

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The Benefits of Independent Talent

Including independent talent as part of a workforce strategy can help companies become more agile by increasing supply chain control and boosting overall efficiency. Independent contractors come to jobs with a wealth of experience and expertise, giving businesses a competitive advantage by allowing them to fill skill gaps in their workforce quickly and temporarily.

Contingent workers allow companies to create a more fluid workforce that can scale up or down according to project needs, seasonal demands, or market changes. Independent contractors can reduce costs from many angles, such as the costs associated with full-time employment like benefits, insurance, or long-term commitments. Engaging an independent contractor for a project lowers the financial burden of finding, hiring, and onboarding a full-time employee to complete similar tasks.

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Building a Blended Workforce

There are many strategies companies can use to build blended workforces. Many are prioritizing ways to improve management, incorporating new ways to find independent labor, boosting their knowledge on worker classification, and shifting traditional roles into project-based tasks

To maximize the use of contingent talent, start by identifying skill gaps and project-specific needs. This will help you determine which tasks or projects will benefit from the expertise of independent contractors. Next, build a talent pool by developing a network of reliable contingent workers. This will be a group of talent that have already worked with your company or whose skills have been vetted in some way.

Other strategies include using digital tools and platforms to effectively manage contingent talent. Workforce management software can help with onboarding, tracking project progress, and facilitating communication between managers and teams. As a project gets started, define clear objectives, deliverables and timelines. Regularly check in to ensure alignment with project goals. Lastly, be sure to measure and evaluate performance. Provide feedback, identify areas of improvement, and share successes with the rest of the company.

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