The COVID-19 pandemic has changed the way we work. In truth, the world of work was changing long before the pandemic hit. But, the future of work, which was just a concept pre-pandemic, is now a reality. And COVID-19 is responsible for accelerating this shift.
For example, although remote working was growing in popularity before COVID-19 struck, now it’s the norm and this trend is set to continue. Don't just take my word for it. More than three quarters (86%) of respondents agreed their companies would be more likely to adopt flexible and agile working practices even after COVID-19 is brought under control, according to WilsonHCG’s COVID-19 impact survey.
To thrive in the post-pandemic era, organisations will need flexible workforces and a holistic approach to workforce management. The role of the external workforce, otherwise known as the contract workforce, will be instrumental in achieving this.
We live in an era dominated by chronic skills shortages; as a result, companies have come to rely on temporary talent to plug the gaps. This is compounded by the different priorities that millennials and gen Z have regarding what, where, when and how they work. You only have to look at the rise in talent platforms such as Upwork, Toptal and InnoCentive. According to research from the Harvard Business Review, these on-demand platforms have quadrupled, going from 80 in 2009 to more than 330 now.
Further, the Harvard Business Review surveyed almost 700 businesses that use the platforms, which revealed that 90% of the leaders questioned believe these platforms will be critical to their ability to compete in the future.
Pre-pandemic, 36% of the workforce consisted of contingent workers, according to a report by Upwork. But that figure is set to rise for several reasons:
Put simply, organisations that view talent as a whole have a competitive advantage over those that don’t. With a holistic approach, talent acquisition teams can hire the best type of worker by accessing skills aligned to specific business needs.
Hiring manager requirements are supported while still maintaining control of budgets and headcount. This approach also helps internal mobility programmes. Permanent employees will be able to move around within the business while developing their skillsets, reducing the need to source new talent.
Read more on why a holistic approach to talent management is essential
Traditional direct sourcing was implemented to shift away from the expensive mark-up or not-to-exceed models, reducing dependency on staffing agencies. However, a true direct source programme brings greater benefits than just cost savings.
Direct sourcing enables organisations to implement outreach and engagement strategies to support wider initiatives such as total talent and diversity, equity, inclusion and belonging. In addition, it ensures compliance standards are met so companies don’t fall foul of the legislation associated with this group of workers. This is key given that IR35 will come into force in the UK on April 6, 2021.
Employers that opt to increase their use of gig workers over the coming months will need to ensure they have effective virtual onboarding processes in place to bring contractors up to speed. In addition, they'll also need to consider how to manage performance and decide whether contractors will be eligible for the same benefits as their full-time counterparts.
The dependency on external workforces is expected to soar over the coming months. Organisations need to take action now to transform their labour programmes so they can thrive in the new world.
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