America works far differently today than it did a century ago.
In the 1910s, less than a fifth of the adult population had finished high school. Most people worked on farms or in factories. The national unemployment rate vacillated between 1.4 and 10 percent. Full-time workers averaged about 50 hours per week, and working conditions were notoriously dangerous.
100 years later, contingent work is becoming the new normal. The numbers vary widely, depending on the definition of contingent you use and the type of workers included. Estimates by the Government Accountability Office run as high as 40.4% (in 2010) of the workforce. There’s little doubt, though, that what is commonly called the gig economy is growing. An EY survey found 1 in 2 organizations reporting “a significant increase in use of gig workers over the last five years (2011-2016).” On average, organizations said contingent workers made up 17% of their workforce in 2016.
Is that ra eason to lament the loss of “traditional” work? No. Contingent work will never entirely eclipse full-time employment. Work arrangements are always changing, and thriving companies change with them.
Take Southwest Airlines. Not only has it embraced contingent workers, but it’s built out a world-class worker engagement program. As Southwest has grown, so, too, has its use of contingent workers for everything from interns to professional services to cleaning crews.
Still, change is not easy for HR or workers. To ready your company for the 21st-century workforce, focus on three key areas:
1. Recruitment and hiring
Contingent work isn’t new, but the way today’s companies are approaching it is. Previously, they might’ve used temp workers to shore up a summer staff or complete one-off projects. Now, contingent work is at the core of companies’ talent tool kits. In fact, 93% of businesses are considering making structural workforce changes within two years.
When recruiting, be strategic. Consider your company’s goals, and think about what work is needed to achieve them. What type of talent — full-time employees, part-time employees, or contingent workers — is best suited for each task?
In this case, strategy requires standardization. Draft policies that define benefits, types of work, and “rules of engagement” for each worker class your company engages. You might, for example, state that benefits are available to full-time employees only and that contingent workers are ineligible.
If your company hires contingent workers regularly, create a formal hiring strategy. Designate someone to manage it — either an internal team member or an employer of record — who’s familiar with labor laws and co-employment.
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Is Talent Acquisition a Strategic Business Partner to Companies?
Onboarding is a worker’s first exposure to the company’s “employer brand,” meaning that it’s crucial to get it right. Someone who has a bad experience is likely to share it with others, damaging future recruitment.
Fortunately, for the most part, onboarding is onboarding. Contingent workers, full-time employees, and part-timers all need to know the company structure, their duties, their pay rate, their manager, and more.
For contingent workers, the difference may be that onboarding happens through a third-party staffing firm. If you decide to use one, choose a partner whose onboarding process mirrors your own. Share any company onboarding materials needed to set expectations for contingent workers. Whether done by a staffing firm or your internal team, onboarding sets the stage for workers’ broader experience with your company.
In the age of contingent work, creating a cohesive culture is hard but essential to do well. When workers are in different buildings (and sometimes even different countries), communication can fall apart. Take a page from Toptal, which creates community among its contingent workers with events ranging from panel discussions to barbecues.
Cultural integration should start at your first candidate interaction. Be upfront about the company’s persona and what types of people tend to succeed at it. It may be uncomfortable, but providing cultural expectations at the outset will eliminate surprises and create consistency.
Provide cultural guidance to managers overseeing contingent workers, too. Train them on communication practices (including channels and frequency), remote worker engagement strategies, and technologies like Zoom, which works great for remote team huddles and video-conferences.
This is the future. Contingent work is expanding; the gig economy is here to stay.