Growing your staffing firm in the gig economy

Today’s executives now realize that talent can come from a variety of sources, not just in-house, full-time employees. The number of temps, freelancers, contractors and other nontraditional employees has officially expanded to more than a third of the global workforce, creating a new “gig economy,” according the 2016 survey and forecast conducted by Ardent Partners and SAP Fieldglass.

Who are these “gig workers”? Findings of a National Institutes of Health study, published in Journal of Occupational and Environmental Medicine in April 2017, revealed several key demographics of the gig workforce.

  1. Gig workers tend to be younger and more highly educated than traditional contingency workers. Five times as many 18-to-29-year-olds reported earning money from gig work in 2015 than those age 50 and older (16 percent versus 3 percent).
  2. Gig workers are professionals across a spectrum of fields and experience levels, including students and new graduates, creatives, partial retirees and those in-between careers or jobs.
  3. Their motivations vary. Some gig workers seek flexibility, while others focus on career transition or advancement opportunities, and still others mainly want a lifeline to make ends meet.

The gig worker lifestyle generally offers greater flexibility and freedom. However, people who want to work as free agents may look to staffing agencies to connect them with job opportunities and employers seeking their unique skillsets. Temporary staffing agencies, which are already in the human resource business and knowledgeable about business’ labor needs and government regulations, are strongly positioned to take advantage of the gig economy.

Providing just-in-time talent

Staffing agencies have been supplying on-demand talent to companies for decades, but now the expectation is just-in-time fulfillment. In today’s gig economy:

  • Managers are habituated to lean operations and the constant need to cap labor costs. They want to fill slots as projects develop, rather than months and weeks ahead. Having the flexibility to hire the talent they need when they need it is crucial to the bottom line.
  • Managers appreciate “trying before buying” to ensure a good fit with their existing staff’s capabilities and the company’s culture.

Keeping tabs on seasonal fluctuations and new business development is nothing new for staffing agency reps. However, responding quickly to provide clients with the right expertise at the right time requires agility and proactive planning.

In addition to employing smart management and marketing strategies, here are some ways your firm can find and incorporate gig workers into its operations effectively.

  1. Address client concerns up front. Some employers are embracing the gig economy with open arms, but many still have concerns – ranging from the cost of hiring individual talent for new projects to the lack of visibility when using contingent workers. Almost half of businesses surveyed for a article said they carefully weigh hiring nontraditional talent when new projects and initiatives entail unique cost evaluations and budgets. More than a third (37 percent) of businesses cited concerns about the ability to grow a workforce that is constantly in flux. Helping your clients understand the benefits of hiring gig workers, and addressing these concerns, can help you identify staffing solutions that both meet their needs and ease their concerns.
  2. Employ a range of recruiting tools. The median age of gig economy earners in the United States is just 32 years old.1 But gig workers fall across all age groups, meaning they use a variety of online platforms to find work. To tap into this specialized talent, continue to use both traditional recruitment methods, including your firm’s website, advertising and referrals, in addition to mining profiles on internet hiring platforms, using social media and reaching out to academia and professional organizations.
  3. Stay updated on rules and regulations. In the same CIO survey, 46 percent of companies specifically stated concerns around compliance with regulatory labor guidelines when hiring people from other states or countries. Thus, adeptly managing this new labor class hinges on consistent oversight in the areas of regulatory compliance, screening and background checks, training, engagement and turnover rates. Understanding the impact of recent court decisions related to nontraditional employment practices is also important to protect both your clients and your business.
  4. Use technology to streamline operations. Access to new technology for managing recruitment, scheduling and payroll is increasingly essential as the gig economy grows. Adopting enterprise resource control software, such as freelance management systems (FMS) and external payroll services, can make managing gig workers easier and will allow your agency to focus on its core business of establishing and maintaining customer and talent relationships. In addition, consider creating a portal or smart mobile app to further streamline real-time communication with clients, prospective workers or both.

For staffing agencies, the gig economy represents both a huge opportunity and a challenge to adapt to a new model of employment. Agencies that can attract and incorporate this new class of high-quality, specialized gig workers to meet clients’ needs can capitalize on this trend successfully – and in the process, benefit from a new pool of skilled talent.