Hiring Independent Contractors: Why Everyone Will Be Doing It By 2020

Hire an independent contractor. No really – everyone else is doing it or will be doing it.

In today’s workforce contingent workers (defined as independent contractors, part-timers, or temporary/leased employees) can be one of your company’s best resources and the trend is really picking up.

But before I go any further, I have to provide a full disclaimer – I work as an independent contractor and have for about six years. As an independent contractor, I work for companies as a 1099 employee (and use my company as the employed party) and work on a retainer and/or project-basis depending on the situation. And honestly, it works.

Back in 2008 when I began to work in this capacity (basically because I couldn’t find the “right” job), I remember people telling me I was nuts. The naysayers were worried out me not having stability, benefits, and all the fun stuff that comes along with full-time employment (you know, meetings about meetings?). They also could not grasp the concept of how I could possibly work for different clients and companies and not have a traditional 9-5 job where I went into the same office and worked for the same company day after day. At the time, I couldn’t imagine the reverse.

Flash forward to 2014 and it seems that I (along with many others) was onto something. Now, contingent workers are in demand. Companies – of any size – are realizing that people who work in this capacity can really help their workforce.

Now, my goal isn’t to convince anyone that independent contractors and contingent workers are important to businesses (and can have an unexpected positive impact on business production and growth), but I will present facts.

The recent report, Workforce 2020: The Looming Talent Crisis, commissioned by Oxford Economics and SAP, showed that the 2020 workforce is going to be much different than anything we’ve ever seen…and companies need to prepare. To gather their findings, in the second quarter of 2014 they surveyed over 2700 executives and 2700 employees from 27 countries.

When asked about the changing nature of work, 41 percent of the respondents felt that their company was increasingly using contingent workers – and that was the highest agreed upon response to the question.

When it came to the executive responses, 83 percent said they are increasingly using consultant, intermittent employees, or contingent works in new ways. Even further, the rise of non-payroll positions is forcing change on companies, with 42 percent stating that it is affecting their workforce strategy.

One of the reasons for using these types of workers is the unpredictability of the economy. Without being able to definitively forecast the growth of your company and need for an extended workforce, taking on permanent employees who are on payroll and are receiving benefits can be quite a risk.

A February 2012 article on Forbes highlighted Scale Computing, an Indianapolis-based company who specifically hired independent contractors for that exact reason – to scale his business.

Another way these workers are being used is in the old-fashioned temp-to-hire style. For companies and employees, it’s a win-win. Companies can “test” these temporary employees for “right fit” and vice versa. In 2013, it was reported that nearly 2 percent of the total workforce in the United States was classified as temporary workers. A somewhat high number when considering the traditional career path taught to Baby Boomers and Gen Yers – get a job and keep your job.

In addition to the cost-savings and convenience of contingent workers, there is also an opportunity to hire someone with a specific skillset and unlock their potential by applying it in a way that a regular employee wouldn’t be able to due to the demands of the full-time gig. For instance, hiring someone with a specialty to complete a specific project may allow the team to have a particularly skilled leader who can bring more to the table than any of the full-time employees. Also, because the contingent worker is focused on one project or aspect of the project, he/she can be very dedicated.

Now of course, there are always two sides to every story and a temporary worker, if not disciplined enough or frankly, talented enough is working on a project, they may be less motivated and driven to reach the end goal than a full-time employee. The upside is that contractors can easily be let go. Then again, if you find a good one, don’t let that happen.

View the original article here

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