The use of contingent workers is on the rise. The U.S. Bureau of Labor Statistics defines contingent workers as anyone who "does not have an explicit or implicit contract for long-term employment" (Phillips & Gully, 2011 pg 51). This definition includes independent contractors, freelancers, consultants, and temporary workers who may or not work for an agency. In the past 50 years, temporary workers have been crucial to many businesses, and their role in business is growing. Companies must recognize potential problems and concerns brought about by employing temporary workers, and adjust their approach to staffing.
Contingent workers have long been employed to fill seasonal jobs, to complete specialized projects, and to fill in for employees on leave. When business is cyclical, companies hire temporary employees during their busy season, such as summer vacation, the winter holidays, harvest time, and tax season. Temporary staffing firms emerged in the 1960s, primarily to supply clerical and secretarial jobs (Rassuli, 2005). Some companies hire temporary help to protect regular employees from overextending themselves. Some projects require workers with a specific skill set which may not be needed the rest of the time. In this case, an organization relies a on contractor or freelancer to complete the project. Contingent workers often provide immediate temporary replacement for employees on vacation or leave (Paul & Townsend, 1998). Agencies such as Robert Half may supply companies with contingent workers with as little as a few hours notice (M. Kelley, personal communication, December 12, 2013).
Some companies employ contingent workers to screen potential candidates. Doing so allows both the candidate and employer to figure out if they are a good fit while minimizing negative impact.
The use of contingent workers tends to increase during economic downturn and decrease during upswings, but the contingent workforce has actually increased this past recovery (Swart, 2011). Recently, employers have been employing contingent workers as a cost-cutting measure. Even if pay is equal, companies save money by not paying for benefits, minimizing training costs, and avoiding investing in promotions and career-development costs. (Paul & Townsend, 1998).
The Rising Importance of Temporary Workers
The shaky economic situation of the past decade has increased the preference to utilize a contingent workforce. In 1989, contingent workers comprised 6% of the U.S. workforce; by 2013, that number has risen to between 20% and 33% of the workforce (Vandlen, 2011), and this figure is expected to rise in the future. Staffing agencies supply over 11 million temporary and contract employees every year (Swart, 2011).
Because of the recession, companies have been under pressure to decrease labor costs while increasing productivity and employee motivation, and few things are as demotivating as hiring employees only to lay them off...