Editor's note: The following is a contributed piece by Sara Jensen, vice president of business development at Innovative Employee Solutions, an HR solutions provider.
The gig economy is here to stay. More than a third of the American labor force is composed of contingent workers, and that number is growing. Freelancers are expected to make up the majority of the workforce within the next 10 years, according to an Upwork and Freelancers Union study. That proportion will only grow; the same study found that nearly 50% of millennial workers are already a part of the gig economy.
Workers have more ability to create their careers the way they want than ever before. Increasingly, workers are choosing values such as flexibility and autonomy over the stability of full-time, permanent jobs. And many businesses are meeting them halfway.
Many of the companies that have found efficiency within the contingent-focused economy have shifted to an organizational structure that is less hierarchical and more horizontal. Business objectives are tied to specific strategies and projects that can be accomplished with small teams or groups of workers, making it easier to hire freelancers and for employees to work autonomously. Thanks to technology in the workplace, these shifts are easier than ever to navigate.
As this trend toward gig-based workers only grows more ingrained in the modern workplace, HR professionals will be vital to helping companies embrace contingent workers. Here are some key ways to adapt as you mine the freelance field to find folks who can provide the best value for your company:
Consider what skills you need when
Sometimes, companies might only need someone with a certain skill set to work on one project or with one client. Those scenarios lend themselves perfectly to hiring freelancers or independent contractors. This way, the company can avoid committing permanently to workers that it might not need on an ongoing basis.
Recruit in alternative talent streams
Look at newer platforms for hiring contingent workers. Online staffing platforms such as Freelancer.com, Toptal, and Upwork have popped up in the past five to 10 years and have grown into trusted spots to find freelancers with niche skill sets. If your company is set up for more traditional employment and is new to hiring contingent workers, these recruiting platforms are a great place to start. Just don't forget to factor in potential costs — some platforms allow you to pay per placement, while others require ongoing subscription fees.
Know the risks and prepare protections
Alongside the advantages of employing contingent workers, there are unique issues — and liabilities — that may arise. Your company must have explicit definitions for full-time permanent, part-time, and contingent workers, as well as policies regarding how the company engages with each type of employee.
Most U.S. companies don't have remote work policies in place, according to Upwork's "Future Workforce Report." If your company is part of that majority, it could be at risk for co-employment concerns, non-compliance with labor laws, and misclassification fines. If needed, consider partnering with a third party to guide you through common pitfalls.
Make culture crucial
Employing contingent workers — or even remote employees — can make establishing an accepted company culture more difficult. But your company culture is part of your employer brand, and it will be one of the key factors in recruiting and retaining top talent, whether that talent is permanent or contingent. With contract-based workers, HR might have to spend a little more time and energy fostering connections among co-workers than it normally would. Here are a couple of starting points:
Consistently and accurately describe the company culture during the interview and onboarding processes. If you're utilizing suppliers, go a step further by partnering with ones that share your company's values to create a more cohesive experience.
Train managers on best practices for working with remote workers, focusing on topics such as maintaining engagement or the best communication methods. To that end, companies can draw on technology — think videoconferencing, instant messaging and cloud-based file sharing — to make communication between on-site and remote workers as seamless as possible.
These are only a few of the adaptations companies must make in the face of an increasingly contingent workforce. To ensure companies' future success, HR must also think strategically in order to best utilize contractors, freelancers, and project-based workers. Developing formal policies to protect against liabilities is also crucial, as is maintaining a cohesive company culture while integrating contingent workers with permanent employees. With these strategies in place, your workplace will be ready to use the gig economy to the best advantage.