Ready or not, the alternative workforce is going mainstream
Using alternative workers can enhance organizational performance if managed efficiently and correctly.
Well, it used to be regarded as alternative work—but now, as organizations transform themselves, freelance, gig and contract work are now mainstream.
But businesses will have to get better at managing the so-called alternative workforce, according to Deloitte’s 2019 Global Human Capital Trends report, particularly since the formerly mainstream workforce is under pressure globally from a short supply of workers, a lack of qualified candidates, workers’ desire to make more money from “side hustles,” lower birth rates that are shrinking the labor pool and the reentry of retirees into the labor market.
According to the report, the alternative workforce is composed of a range of types: contractors who actually work for another company and are brought in to meet specific needs, freelance/independent workers who don’t necessarily want to have a regular boss, gig workers who take on projects or parts of projects and crowd workers, who compete to become part of a project and may not get paid if they’re not among top performers.
Related: Gig workers’ importance to grow over next 5 years
But the need is surging, with 45 percent of employers globally saying that they have trouble finding workers to fill positions; that’s the highest it’s been since 2006. But wait, it gets worse: according to the report, 67 percent of companies with more than 250 workers are among those struggling to find the qualified workers they need.
And it’s not just IT in which alternative workers are used. While a third of respondents say they use alternative workers extensively in IT, 25 percent do so for operations, 15 percent for marketing and 15 percent for research and development. The workers themselves come from both traditional staffing firms and talent networks that focus on particular segments of the population such as active duty and veteran military, working parents and retirees.
However, the report also finds that most companies aren’t using such workers strategically; instead, they’re using them transactionally—just to “fill slots” and not to meet long-term needs with efficiency.
Yet using alternative workers, it adds, “can enhance organizational performance” if managed efficiently and correctly. It says that a properly managed alternative workforce “enables an organization to put the right talent in place where and when it’s most needed to get results, in a labor market where traditionally on-balance-sheet talent is becoming ever harder to find.”
HR is beginning to respond accordingly, with 75 percent of this respondents indicating that HR supports sourcing alternative workers. Meanwhile, 66 percent report HR is involved in training them, 65 percent say they negotiate work arrangements, and 63 percent are involved in benefits management.
But there’s also the need to treat such outsiders with sufficient respect that they feel a part of the team—while not alienating regular workers who may feel penalized by the attention and resources devoted to those “outsiders.”
Read more: