The World Economic Forum’s “The Future of Jobs Report 2018,” shows that by 2022, 64% of companies are likely to outsource some business functions to external contractors. This is among the top five ways respondents plan to cope with the skills gap. (Other methods include automation of work and retraining of current employees.) Read below to learn about why companies that leverage independent contractors will find business success – it’s the future of work.
Companies appreciate the flexibility of hiring independent contractors as much as the contractors enjoy the flexibility. They save cost for not having to hire someone full-time, especially someone they may not use to maximum capacity. Sure, independent contractors usually charge a higher hourly rate, but they aren’t costing the company in benefits, taxes, insurance, office space, equipment and training. Companies experience less stability if they use a significant number of independent contractors, but it does make them more agile (which is important in this ever-changing business environment.)
Companies also benefit because they can land talent with more specialized skills and apply their expertise to specific projects. Independent contractors usually ramp up quicker because they are accustomed to integrating themselves in multiple client businesses.
There are more women in the workforce than ever. (In December 2018, 47% of the civilian labor force were women, according to the Bureau of Labor Statistics.) Offering a flexible working option means parents don’t have to leave the workplace when they have children. Couples are starting families later in life, when both individuals are already established in their careers, and being an independent contractor gives them a flexible option to continue working while raising their family.
Technology has given us the opportunity to provide flexible working options because we can collaborate remotely and provide real-time updates for project work. This empowers companies to hire globally and only the best talent. With a limited number of skilled workers out there, it’s less about wooing the top talent to come work for you exclusively and more about securing the right talent for when you need them. The availability of talent is less of a concern because people aren’t committed to one company for all their working hours.
According to an NPR/Marist poll, 66% of part-time workers prefer that kind of schedule. And numerous studies have shown that millennials, who now make up the majority of the workforce, expect flexibility from their jobs. Work-life balance is top of mind for many, so interest in participating in the gig economy is high.
Another force is that as baby boomers are retiring from their full-time jobs, they are considering flexible working options. They are extending their careers as part-time consultants, as they are championed for their expertise.
As the interest in freelancing increases and the supply grows, companies who experience business success are those figuring out where these independent contractors fit into their work world. (If you’re a new independent contractor looking to get some tips on managing your workload, check this out.)