Contingent workers were around long before the pandemic changed the workforce landscape in 2020. But now that we’re living in an (almost) post-pandemic world, the contingent workforce is here to stay. Never before have we experienced the kind of flexibility we see now – the gig economy and the use of contingent workers has grown significantly over the past few years and it was only accelerated by the pandemic.
What work means has been forever changed – and your organization can either keep up with the contingent workforce revolution or be left behind.
But let’s back up. What exactly is a contingent workforce, and what’s spurred the exponential growth of this type of work? How can a Managed Services Provider (MSP) help, and what are the benefits of using one? Read on to learn more about the contingent workforce revolution and how you can embrace it with the power of an MSP.
What is a Contingent Workforce?
A contingent workforce refers to the part of an organization’s workforce that is not permanent, or full-time. This group could include independent contractors, gig workers, freelancers, temporary workers, and workers engaged under a Statement of Work (SOW).
Depending on the type of industry and the work needs, a contingent workforce could be quite large, even at one company. And rather than a company managing this large contingent workforce on their own, many turn to a Managed Services Provider (MSP) for help. But we’ll learn more about that in a moment.
Why is the Contingent Workforce Growing?
It’s important to note that the contingent workforce was around long before the pandemic made it a more common term. Back in 2019, the contingent workforce had expanded by one million people as compared to the previous year, according to Staffing Industry Analysts. The trend was already taking off as gig work, freelancing, and contracting become more and more popular. And then the pandemic hit, which only accelerated things when the need for contactless delivery, touchless service, and more came about. Plus, many people who lost their jobs turned to contingent work in order to stay afloat.
It’s plain to see why joining the contingent workforce is a positive move for many employees and job seekers. But what about the employer side? There are many benefits to using a contingent workforce, including:
Reduces Overhead Costs
Relying on the contingent workforce decreases overhead costs for organizations across the board. Rather than sourcing, interviewing, and hiring multiple full-time candidates, companies can simply rely on temporary employees on the staffing agency’s payroll, or outsource to freelancers without having to commit to costly benefits packages and other employment-related costs. Whether an organization needs to ramp up hiring to meet increased demand, or they’re in need of extra workers for a particularly busy season, relying on the contingent workforce is a cost-effective way to get the job done.
Increases Diversity Hires
Relying on the contingent workforce is a great way to increase diversity within your organization’s labor force. Working with a professional recruitment firm allows you to source candidates from every background and culture, allowing you to broaden your workforce’s knowledge and viewpoints in order to make innovations. And it will make your employees happy – according to data from CNBC, nearly 80% of workers want to work for companies that value diversity, equity, and inclusion.
Fills Skill Gaps
When you need specialized talent for a particular need, or perhaps to help complete a special project, you don’t always want to hire a full-time employee. That’s another great benefit of relying on a contingent workforce. You can fill those skills gaps with talented professionals without hiring a new employee full-time. That lets you scale up when you need the skills while saving money and resources at the same time.
How a Managed Services Provider (MSP) Can Help
We’ve learned what a contingent workforce is, why the need for a contingent workforce is there (and growing), and what the benefits of this kind of workforce are. As mentioned above, many companies don’t have the time or resources to manage an entire contingent workforce on their own. That’s where a Managed Services Provider (MSP) can help.
An MSP is an outsourced third party that manages and assumes the responsibility for your contingent workforce. An MSP can take care of services like payrolling, human resources, contract management, compliance, vendor management, procurement and sourcing, and more. Dahl Consulting’s MSP programs can provide your company with the contingent workforce management solutions you need.
Employer of Record (EOR) Payrolling Services
With Employer of Record (EOR) payrolling services, you can keep temporary or contract workers on the provider’s payroll, allowing them to take care of the administrative burdens involved in payrolling like paycheck distribution, tax withholdings, workers’ compensation, unemployment, and more. If you have a known worker you would like to engage on a contingent or contract basis but need help with compliant onboarding and an exceptional candidate experience along with administrative support, EOR services are for you.
Vendor Management System (VMS)
A vendor management system (VMS) is software that facilitates contingent workforce management. With the support of an MSP, a VMS helps client organizations, candidates, and staffing firms efficiently collaborate on sourcing, placing, and managing contingent workers. It’s usually cloud-based and holds all sorts of data that supports your contingent workforce management needs. Use a VMS when you need to source contingent workers but you lack the time, resources, and knowledge to do so while maximizing your return.
Dahl Consulting’s APRU (Advanced Platform Resources Unlimited) technology is our proprietary VMS system that serves as the technology component for our MSP programs. Our system is designed to help you organize the chaos that can be managing contingent workers and a contingent labor force – it will provide complete visibility to this component of your workforce and automate the workflows to source, hire, approve time, and pay invoices.
Benefits of Working with an MSP for Your Staffing Solutions
Are you interested in employing a contingent workforce to meet your operational objectives and business goals? There are many benefits of working with a managed service provider in Minnesota that understands your business and the staffing solutions you’re looking for.
Streamlined Access to Top Talent
Of course, one great benefit of relying on an MSP is the streamlined access you’ll have to the region’s top talent. Your MSP is responsible for sourcing and procuring high-quality candidates with the experience and skill sets you need to complete projects, meet deadlines, and achieve business goals. And if you need specialized niche talent that is hard to find, the MSP can provide that, too.
Remember that working with an MSP is one of the most cost-effective decisions you can make regarding your contingent workforce needs. Because you’re outsourcing the management and direction of your contingent labor workforce and keeping employees on your staffing partner’s payroll rather than your own, you’re saving money and resources while still getting the labor solutions you’re looking for. That’s a great thing for your bottom line.
One of the great things about using an MSP and the VMS system that facilities it is the increased visibility you’ll have into this component of your workforce. The technology allows you to gain data-driven insights into what’s working and what’s not when it comes to your contingent labor. That lets you make smarter decisions moving forward about this component of your business and how to utilize it to maximize return on investment.
It’s very easy to misclassify contingent workers, perhaps incorrectly designating an independent contractor or making a mistake on what positions qualify for overtime. These compliance issues can get you into trouble and prove quite costly – and mitigating that risk by allowing an MSP to handle it for you is another great benefit of this kind of service. An MSP helps you mitigate risks in other ways, too: you can rest assured that workers have the proper certifications and level of experience, and you avoid the risk of a costly bad hire thanks to the MSP’s thorough sourcing and vetting process.
A broad benefit of using contingent workers is the agility it gives your company. You don’t have to employ full-time workers when you don’t have the need – you can rely on temporary, contract, or other types of contingent workers to meet your needs, especially during periods of increased demand or when special projects that require unique skill sets come up. The ability to scale up and down, saving money and resources as you go, means your entire business is more agile.
Partner with DAHL for Contingent Workforce Management Solutions Today
Dahl Consulting is the vendor neutral MSP provider you can count on for your contingent workforce management solutions. Since 1993, we’ve been providing adaptive and inclusive staffing and workforce solutions including staffing services, payrolling solutions, MSP programs, and vendor management systems to great companies. We’re the recruiting firm that gets the job done right, the first time.
Learn more about our contingent workforce management solutions by contacting a member of our team today.