Last year, a local startup approached me about finding a legal executive to negotiate contracts — a task that was weighing down the firm’s chief operating officer and leading to high outside legal fees. The company’s management wanted high-level talent but worried that their pay scale would make it challenging to recruit in-house counsel.
After learning more about the company’s needs, I suggested hiring a legal executive skilled in contract negotiations who could work part time on a contract basis. The unconventional solution allowed the firm to gain access to a professional who not only fit their needs, but their budget as well.
Hiring workers on a flexible basis may sound unusual, but it’s quickly becoming more common. In its U.S. job forecast for 2014, CareerBuilder expected 42 percent of employers to hire temporary or contract workers this year—up from 40 percent in 2013 and 36 percent in 2012. CareerBuilder also projected an increase in part-time hiring, with 17 percent of employers surveyed saying they planned to hire part-time workers, up from 3.6 percent in 2013.
The most obvious advantage of shifting the hiring paradigm toward more contract and “contingent”-based workers is reduced overhead. Employers who use contract workers aren’t on the hook for health insurance, retirement-plan contributions, paid time off or a slew of other benefits.
But even more important is the type of workers that employers are gaining access to for a lower cost. Typically these seasoned employees offer a more focused, task-driven approach and don’t require as much hand-holding or the long learning curve so common when hiring entry- or mid-level employees on a full-time basis.
Hiring part-time workers or contractors also allows employers to avoid overstaffing and gives them greater ability to hire based on project or assignment. In addition, “test driving” temporary or contract workers offers a great opportunity for both employer and employee to vet each other. I’m sure we’ve all had experiences with candidates who look great on paper but fail to mesh with an organization’s vision or culture once they’re hired. A contract arrangement almost serves as an audition for potential employees, providing the hiring firm with a preview of how well the employee will perform and fit in.
On the flip side, contractors are able to get a feel for the organization and how it operates before agreeing to a long-term commitment. Remember that happier, more committed employees build retention and loyalty, which drives down costs of rehiring, training and establishing new employees.
Also, it’s not unusual for a company’s needs to evolve during a temporary assignment. Maybe someone working on a contract basis takes on multiple roles or exhibits talents that an employer didn’t initially consider. The startup I mentioned earlier was so impressed with the legal executive I placed that after her six-month contract expired, the company hired her to work part time permanently.
Employers who are stuck in a “full-time” mind-set may soon find fewer potential employees to choose from. According to software company Intuit, 40 percent of the American workforce will be freelancers, contractors or temp workers by 2020.
The shift toward independent work makes sense given the rising demand for flexibility. Indeed, 73 percent of working adults agree that flexibility is one of the most important factors they consider when looking for a new job or deciding what company to work for, according to the Mom Corps Biannual Workplace Survey conducted by Harris Interactive. Flexible work assignments give employees more control over their schedules, an opportunity to keep their skills sharp and the potential to earn more money while working fewer hours.
I think we are all guilty of plodding along and doing things the way they’ve always been done. But when it comes to the way we work and the way we approach hiring, the writing is on the wall. Vast new work options are open to employees and employers, and it’s time for both sides to embrace a new paradigm.
Lauren Sveen is owner and president of Mom Corps Denver, a national talent acquisition firm specializing in connecting high-growth firms with high-caliber talent. She is a sought-after speaker on employment trends, organizational strategy and work/life integration. Info: