Is your workforce as FLEXIBLE as it needs to be? Lots of people are talking about the need for flexibility in the workforce as the economy bounces back from the pandemic. But why?
Welcome to a STOP: START Labor Market
It comes down to organizations like yours seeking to maximize resourcing options and minimize risks at a time when most commercial markets are unpredictable, with some in a complete state of flux. Not every part of the economy is rebounding at the same pace. Organizations are facing an unclear future.
That said, life goes on. Organizations need resources to turn manufacturing, logistics, research, education and transactional processing back on. Even as we step through the early shoots of economic recovery, the job market is heating up. In the last few weeks, demand for the best talent has noticeably picked up. It won’t be long before the best talent has been snapped up and we return to a labor market where the biggest brands maintain a marked advantage of having first pick of the available talent.
It leaves talent leaders in a difficult position. They face similar demands for VOLUME of talent as before COVID-19, but the risk of employing more FTEs to fill vacancies comes with the big risk that the market could turn again at any moment. Requests from on-high are often delivering mixed messages to resourcing teams – ’Stop!’ ’Start!’ ‘Hire!’ ‘Wait!’
Workforce flexibility can mean a few things…
When business people speak of a flexible workforce, what actually are they talking about? Are they always on the same page, discussing the SAME THING?
The term might be used in the context of the elasticity in the available workforce; i.e. the ability to scale a workforce up or down depending on the changing resourcing needs of an enterprise.
People also use it to describe the versatility of the talent to fill the skills demanded by an enterprise at any point in time. We know that some competencies are particularly influenced by market demands. For example, the kind of scientific competencies needed in drugs research will vary according to the illness areas in demand and judged to offer the greatest potential for revenue.
There is a third dimension to workforce flexibility, and that has more to do with the willingness of resources to work in a different way, in different places, and times. It may be companies are looking for people to maintain their 24/7 help desks, or work from home, or be prepared to work on a task or project basis that doesn’t bind them to a long-term employment contract with unclear business outcomes.
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What kind of flexibility?
The Flexible Workforce organizations need today is probably a blend of the attributes I’ve listed above. Businesses want the ability to:
- Upscale and downscale their resourcing plans quickly in response to changing market demands
- Pick out the skills and competencies they need WHEN they need them to serve the current mix of skills requirements
- Adapt the way they get work done by splitting it down into bite-size deliverables (i.e. projects, parts of projects, even tasks) and paying for outcomes, instead of paying for resources on an hourly-rate or contract thereby reducing their mid- and long-term contractual obligations.
A good time to build a flexible workforce
In truth, there probably hasn’t been a better time for organizations to re-visit how they resource the Jobs they need to get done. There has been massive growth in the contractor and freelancer workforce over the past decade, for both demand and supply reasons:
ON THE DEMAND SIDE, organizations are getting more accustomed to considering how they want to get work done, giving consideration to full-time employment contracts, part-time, gig-working, automation, outsourcing, and the other various options open to them; all in an attempt to further maximize results and minimize costs and risks. More than 1 in 3 roles in the US today are performed by contingent workers, i.e. temporary workers, interns, consultants, freelancers, SOW, contract workers, and independent consultants. COVID-19 is further accelerating a trend towards the use of contingent labor as organizations look to adapt faster to change and push for savings.
ON THE SUPPLY-SIDE – Lots of people have lost their job recently and many have struggled to find full-time employment that pays enough. Freelancing becomes the obvious next-best thing. Becoming a flexible contract worker can also be a life choice. Many individuals today are looking for more work-life balance on their terms. They prefer largely to work from home if they can, and the pandemic has only served to increase this behavior. Some look to use freelancing or gig-working as a mechanism to move location or keep employment options open until they hit on the right full-time job opportunity.
Approximately 26 million Americans have been laid off since the coronavirus outbreak began, with weekly unemployment claims spiking to record highs in the first weeks of April.
According to a recent article by the Brookings Institute, before the coronavirus pandemic, just 14% of employees in the U.S. worked from home five days a week. Now that share has swelled to more than 60%.
States of Play, a joint CNBC/Change Research survey of swing states, finds 42% of respondents nationwide saying they are working from home. Once the economy reopens, 24% say they’d like to work either entirely or more from home compared to how they worked before, while 55% plan to head back to the office. Some 60% report being either as productive or even more productive than they were working from the office.
What this all means is there’s a greater addressable SUPPLY of flexible workers in labor markets today, and that’s matched by a market mood to hire more of them.
How Do You Get Your Flexible Workforce?
Creating a flexible workforce means switching on all of the useful sources of labor that exist beyond Full-Time employment contracts. It’s a long list. It includes:
- Freelancers that fulfil short-term contracts
- Contractors that run their own company
- Indirect workers sourced through third-party recruiting vendors
- Gig-workers; people happy to take on multiple projects at the same time
- Knowledge markets
- Crowdsourcing sites
Sourcing and managing a contingent workforce demands resources, planning and systems. Most Fortune 500 organizations already have robust methods and tools in place, but having a Flexible Workforce Strategy benefits mid-sized and growing organizations too.
If you’re a mid-sized organization and you don’t have a contingent workforce program, you’re not alone: Many mid-sized organizations don’t have a contingent workforce strategy because they presume, for their size of business, costs outweigh rewards—when that’s simply not the case.
Time may be running out if you want the best talent
While it feels like an uphill struggle to get anything done right now, for talent leaders, there’s probably a window of opportunity to get the most from adapting your workforce program.
We all know that a great many people lost their jobs earlier this year on the run-up to the lockdown, and so you’d think there’s a heap of talent out there. But history tells us that flexible workers are normally in higher demand after a market slowdown. Organizations have a habit of reducing their FTEs and increasing opportunities for contractors. If we track historical behaviors that happened in 1989 and 2014 when there were also slowdowns in the economy (though not on the scale we’ve seen with the pandemic), the return to work saw a spike in demand for flexible workers. As soon as this happens the bigger brands (that are more seductive to your audience) have the upper hand.
That means your opportunity to find the best talent is now.
The good news is that modern Vendor Management Systems and talent ecosystems take far less time to implement, and equipping your organization with a flexible workforce talent program might not be as difficult, or time-consuming, as you might think.