Rising labour costs associated with full-time employees have put steady pressure on businesses’ bottom line. Greater use of contingent workers is a strategy used to ease some of this pressure.


Organisations increasingly need to rapidly expand their capabilities, move into new markets, and address the competency gaps created by their evolving business strategies. Contingent workers can be a solution to enable organisations to adjust with the changing market conditions.

Cost management
The increasing ratio of contingent workers in the total workforce — and their growing importance in delivering business results — is driving more focus on managing suppliers of the contingent workforce. Companies that understand the issues associated with contractors and manage them well can benefit from improved operational performance, lower labour costs, smarter staffing decisions, and stronger HR alignment with procurement and business objectives.

Conversely, poor management of contingent workers can negate many of the potential benefits.

Given the talent, cost, and risk considerations that today’s corporations face, the use of contingent workers is becoming a business imperative for many organisations — not just a nice-to-have. Properly managed, contingent workers can provide a significant competitive advantage by reducing labour costs, allowing companies to respond more nimbly to dynamic market conditions, and filling critical workforce gaps.

The flexibility that businesses and their workforce have shown in the recession is likely to become a permanent feature.  There will be a changing mix of core and permanent staff with a greater proportion of the workforce being used on a flexible basis.

The recession has accelerated the need to address inefficiencies and non-core activities.  It has also provided the stimulus for companies to re-think their business strategy and re-evaluate their future – allowing them to make organisational changes that will position them for the upturn and beyond, while building in resilience and flexibility.  It has been a catalyst for change in business that could not have occurred earlier when the focus was on delivering growth.