The rise of the gig economy has transformed the way organizations approach talent acquisition and management. With the global gig economy expected to grow from $204 billion in 2018 to $455 billion by 2023, at a compound annual growth rate (CAGR) of 17.4% (Mastercard, 2019), it is clear that contingent talent will play an increasingly critical role in the future of work. This blog post explores the benefits and challenges of engaging contingent talent, and provides strategies for building robust pipelines of skilled contingent workers.
The Benefits of Contingent Talent
Contingent talent offers numerous benefits to organizations, including cost savings, flexibility, and access to specialized skills. Companies that use contingent workers can reduce labor costs by 30-50% (Intuit, 2020), while also gaining the ability to scale their workforce up or down quickly in response to changing business needs. This flexibility is particularly valuable in today's rapidly evolving business landscape, where agility and adaptability are key to staying competitive. Moreover, 78% of organizations say that contingent workers help them access specialized skills that are difficult to find in the traditional labor market (SAP Fieldglass, 2019), enabling them to tackle complex projects and drive innovation.
Challenges in Engaging Contingent Talent
Despite the benefits, engaging contingent talent is not without its challenges. 40% of organizations say that finding qualified contingent workers is their biggest challenge (SAP Fieldglass, 2019), as the competition for top talent intensifies in the gig economy. Additionally, 35% struggle with onboarding and training contingent workers effectively (SAP Fieldglass, 2019), which can lead to lower productivity and engagement. Managing and retaining contingent workers also presents challenges, with 30% of organizations citing this as a key issue (SAP Fieldglass, 2019). To overcome these challenges, organizations must develop comprehensive strategies for attracting, engaging, and retaining top contingent talent.
The Importance of Employer Branding
To attract top contingent talent, organizations must prioritize their employer brand. In today's competitive talent market, a strong employer brand is essential for standing out and attracting the best candidates. 75% of job seekers consider an employer's brand before applying for a job (LinkedIn, 2021), highlighting the importance of building a positive reputation as an employer. Companies with a strong employer brand can reduce their cost per hire by up to 50% (LinkedIn, 2021), as they are more likely to attract top talent organically. Furthermore, 69% of job seekers are more likely to apply for a job if the company actively manages its employer brand (Glassdoor, 2019), underscoring the importance of proactive brand management.
The Role of Technology in Contingent Talent Management
Technology plays a critical role in managing contingent talent effectively. As the contingent workforce grows, organizations must leverage technology to streamline processes, improve visibility, and enhance the candidate experience. 78% of organizations use some form of technology to manage their contingent workforce (SAP Fieldglass, 2019), with vendor management systems (VMS) and freelance management systems (FMS) being the most common solutions. 45% of organizations use VMS to streamline their contingent workforce management processes (Staffing Industry Analysts, 2021), while 35% use FMS to engage and manage contingent workers more effectively (Staffing Industry Analysts, 2021). By leveraging these technologies, organizations can improve efficiency, reduce costs, and enhance the overall management of their contingent workforce.
The Importance of Diversity and Inclusion
Diversity and inclusion are key considerations for contingent talent. As organizations increasingly rely on contingent workers, they must ensure that their diversity and inclusion strategies extend to this segment of the workforce. 67% of job seekers consider workplace diversity an important factor when evaluating companies and job offers (Glassdoor, 2020), highlighting the importance of creating an inclusive environment for all workers. Companies with diverse executive teams are 33% more profitable than their industry peers (McKinsey, 2020), demonstrating the tangible benefits of prioritizing diversity and inclusion. Moreover, 78% of contingent workers say that diversity and inclusion are important factors when choosing an employer (Kelly, 2021), underscoring the need for organizations to prioritize these issues in their contingent talent management strategies.
The Rise of Remote Work
The pandemic has accelerated the trend towards remote work, and contingent talent is no exception. With the widespread adoption of remote work, organizations have access to a larger pool of contingent talent, regardless of geographic location. 74% of contingent workers say they prefer to work remotely at least some of the time (Upwork, 2021), indicating a strong desire for flexibility among this segment of the workforce. Organizations are responding to this demand, with 68% saying they are more likely to hire contingent workers who can work remotely (Upwork, 2021). Since the start of the pandemic, 45% of organizations have increased their use of contingent workers who work remotely (Gartner, 2021), highlighting the growing importance of remote work in contingent talent management.
The Importance of Upskilling and Reskilling
Upskilling and reskilling are critical components of contingent talent management. As the skills required for success in the modern workplace continue to evolve, organizations must invest in the development of their contingent talent to ensure they have the capabilities needed to drive business success. 87% of organizations say that upskilling and reskilling are important priorities for their contingent workforce management strategies (Randstad Sourceright, 2021), recognizing the importance of continuous learning and development. Contingent workers also value these opportunities, with 65% saying they are more likely to work for an employer that invests in their professional development (Randstad Sourceright, 2021). Furthermore, 78% of organizations say that upskilling and reskilling help them retain their best contingent workers (Randstad Sourceright, 2021), highlighting the role of learning and development in talent retention.
The Role of Artificial Intelligence (AI) in Contingent Talent Management
AI is increasingly being used to streamline contingent talent management processes. As organizations seek to improve efficiency and make data-driven decisions, AI has emerged as a powerful tool for contingent workforce management. 68% of organizations use AI-powered tools to source and screen contingent workers (Deloitte, 2020), leveraging machine learning algorithms to identify top candidates based on skills, experience, and other relevant criteria. 55% of organizations use AI to match contingent workers with job opportunities based on their skills and experience (Deloitte, 2020), helping to ensure the right talent is placed in the right roles. Additionally, 45% of organizations use AI to predict future contingent workforce needs and plan accordingly (Deloitte, 2020), enabling them to proactively address talent gaps and ensure they have the skills needed to drive business success.
Conclusion
Building robust pipelines of contingent talent is essential for organizations looking to stay competitive in the gig economy era. As the contingent workforce continues to grow, organizations must develop comprehensive strategies for attracting, engaging, and retaining top talent. By leveraging the benefits of contingent talent, addressing the challenges, and implementing effective strategies such as employer branding, technology adoption, diversity and inclusion, remote work, upskilling and reskilling, and AI, companies can build a strong and agile workforce that is well-positioned to drive business success in the years to come.
