Understanding contingent workforce management

What is a contingent workforce?

Finding the right talent for the right job is a challenge. The diverse talent pool, skillset mapping, stringent labor laws, remote requirements, and high hiring costs make the recruitment process complex and time-consuming. Because of this, many organizations are looking to employ a contingent workforce to alleviate staffing challenges and get work done quickly and flexibly. But what is a contingent workforce, what does it look like for your organization, and how can it help you meet your goals?

Simply put, a contingent workforce is a group of workers not permanently employed by a company, instead hired on an as-needed basis. These workers are usually brought on board for a specifically designed purpose or for the duration of a given project. As opposed to traditional, full-time employees, the contingent workforce offers the flexibility of short-term, temporary staffing and semi-permanent solutions for managing labor needs without a long-term commitment or costly recruitment.

Leveraging a contingent workforce for staff augmentation can save your organization time, money, and resources, so it’s not surprising that contingent workforce management is growing in prevalence. According to Allied Market Research data, the global contingent workforce management market was valued at $171.5 billion in 2021 and is projected to reach $465.2 billion by 2031.¹ If you’re looking for more efficient, flexible ways to resource your organization, contingent staffing may be the answer. In this article, we’ll dive into the benefits of contingent workers, outline key considerations for your organization, and explore strategies for getting started.

What is a contingent worker, and what are the benefits?

Contingent workers are freelancers, independent contractors, consultants, or temporary employees brought into the organization on a project or hourly basis. They can be project managers, designers, manual laborers, service operators, and more, and their involvement depends on the needs of your business. The key differentiator of a contingent worker is that they provide greater flexibility and shorter procurement cycles than a traditional employee. This can greatly benefit an organization that’s working on tight deadlines, low on resources or time, or simply looking for a flexible, customizable staffing option.

Leveraging contingent workers can impact your organization by:

• Saving time: Tapping into a network of contingent workers allows for a shorter onboarding cycle and reduces the amount of training required for successful project completion.
• Improving flexibility: Contingent workers are hired on an as-needed basis, meaning you can bring on the right talent to meet specific goals.
• Providing expertise: Contingent workers bridge knowledge gaps that can occur when recruiting and hiring traditional employees. They are already experts in their respective fields, giving you the freedom to focus on the project at hand rather than training existing staff to complete the job.
• Saving money: Contingent workers bring about fewer operational costs than full-time employees.

In an environment where resources are already stretched thin, and business needs are constantly changing, flexibility and speed are critical. For many organizations, a contingent workforce can be the solution.

Contingent workforce management for your organization

Where contingent workers can help you fulfill specific roles at the “local level” of a project, contingent workforce management has a larger organizational effect. It can better position you to withstand economic and market volatility, pivot to meet rising or changing consumer expectations, help you scale more effectively, and guide future planning. All these factors contribute to enhanced operational efficiencies.

While the business case is strong for leveraging a contingent workforce, it can be difficult to get started and understand the oversight and management process itself. There are several different ways to bring contingent workers into your operations, most commonly:

• In-house management and oversight using an internal talent pool for workers
• Working with a managed service provider (MSP) to oversee and provide talent
• Leveraging a vendor management system (VMS) to source candidates
• Strategic partnerships to find the right talent

Each has its merit, and the way contingent workforce management works for your organization will depend on your individual goals, the projects you’re looking to staff, and the amount of time and resources your internal teams can put into the program. In many cases, working with a trusted partner or managed service provider can make a big difference in ensuring success.

Contingent workforce management for the public sector

In today's evolving marketplace, public sector organizations are constantly looking for ways to maximize resources, improve efficiency, and drive value for their constituents. There is a proven solution to this challenge – cooperative contracting. Cooperative contracting provides fast, streamlined access to contingent workers, leaving the creation and management of the contracts themselves up to a trusted provider. This helps speed up procurement, eliminating the need for formal bidding, and provides your organization with a network of qualified professionals to help complete your projects.

For example, Sourcewell helps government buyers save time and money by combining the buying power of 50,000 government, education, and nonprofit organizations. Sourcewell holds hundreds of cooperative contracts ready for use by public sector agencies, and CAI has partnered with Sourcewell for the last 7 years, leveraging our contract to help provide services quickly and effectively. With Sourcewell, public sector agencies can more easily procure qualified talent, all while saving time and resources. This is just one of the many examples of a successful contingent workforce management solution.

Getting started with contingent workforce management

The contingent workforce is an increasingly valuable asset in today's dynamic business landscape. Its flexibility allows companies to stay agile, adapt quickly to market changes, and manage costs effectively. By leveraging skilled freelancers and independent contractors, organizations can tap into a wealth of specialized talent and innovative perspectives that might otherwise be out of reach. As businesses continue to evolve, those who embrace the contingent workforce will likely find themselves at a competitive advantage, ready to meet the challenges of the future with resilience and creativity.

At CAI, our holistic approach to contingent workforce solutions helps our clients improve speed-to-hire and operational performance, lower labor costs, align staffing with business objectives, and increase transparency across contingent workforce management and expenditure. If you’re interested in learning more about the ways a contingent workforce can transform your organization, contact us.