New survey by Yoh reveals fundamental transformation in the way business leaders build and manage their workforce
PHILADELPHIA—December 7, 2010—Fundamental changes in the American workforce are taking place, and they hold tremendous implications for employers and employees alike. According to an Annual Workforce Trends Study commissioned by Yoh, 80 percent of employers expect the size of their non-employee workforce (defined as consultants, independent contractors, temporary employees and project teams) to stay the same or increase within the next year, even as the economy regains its footing.
This new temporary workforce presents issues for employers who will need to manage, compensate and motivate workers who no longer view themselves as employees committed to a single employer. At the same time, for employees, this new workforce ushers in a new era of free agency, and holds vast implications for how they will build careers in a flexible work environment, where knowledge and skill trump seniority and security.
Employers’ protracted reliance on a non-employee workforce as the U.S. emerges from a severe recession is a marked change from past economic recoveries when employers would add temporary talent before transitioning to full-time employees.
“Historically, temporary employment has served as a bellwether for permanent hiring, but these findings suggest that something much more substantial is occurring to overall workforce composition,” says Lori Schultz, President of Yoh. “Employers are saying that the recent recession has fundamentally changed their employment strategies and led to a ‘just in time’ hiring strategy that will make temporary employees an even greater pillar of the American economy.”
Other significant findings from Yoh’s Annual Workforce Trends Study include:
• Since September 2008, 88.5 percent of business leaders said the size of their non-employee workforce has stayed the same or increased.
• Sixty-three percent of business leaders surveyed report significant investments in improving the management and effectiveness of its non-employee workforce segment. Some methods include increased employee engagement efforts, vendor consolidation, improved employee communication, and integrating temporary workers into teams in the organization.
• Survey results revealed a significant misalignment between organizational and business priorities. More than 70 percent of business leaders surveyed specified cost as the primary concern with non-employee use, a decision Yoh says minimizes the quality, value, impact, and integration of the temporary segment of the workforce. Accountability, independent contractor compliance, and co-employment risk ranked as the three lowest priorities.
These findings provide further insight into the state of the non-employee market. In fact, temporary employment has risen by 494,000 jobs since September 2009, according to the latest Bureau of Labor Statistics Unemployment Report.
“It is not uncommon to rely on temporary talent during difficult economic times,” says Adam Lawrence, Head of Global Sourcing at SAP. “However, this economic cycle has resulted in a more dramatic and permanent increase in contracted labor. I do not see the current levels of temporary talent decreasing in the near future.”
The transformation of the workforce composition will have significant implications for both employers and employees. Employers now have the flexibility to quickly adjust the size of their workforce depending on project load.
Employees, meanwhile, will have to overcome the stigma associated with “temporary talent.” Now that it’s here to stay, “temporary” workers might find themselves engaged in projects for longer periods of time, frequently transitioning into new opportunities and gaining access to jobs that were perhaps previously filled with full time employees.
“Working on a contracted basis has given me diverse opportunities that I would not have been exposed to otherwise,” says Cecilio Rodriguez, a seasoned contract employee. “Lately, I’ve noticed an increased level of attention from employers toward their temporary staff, and it appears as though temporary employment is not as taboo as it once was.”
For Yoh’s insight on the implications of these trends, as well as recommendations on how organizations can more effectively manage their use of non-employees, please visit http://yoh.com/InsightsTrends/Workforce%20Trends or www.theseamlessworkforce.com.
ABOUT THE WORKFORCE TRENDS STUDY
In September of this year, Yoh surveyed 200 members of business leadership, procurement and human resources at U.S. companies with revenues greater than $750M. Respondents represented various industries, including consumer products, health care, high tech, financial services, life sciences, professional services, and telecom. For the purposes of this survey, “non-employees” was defined as any member of the workforce that does not need a W-2, including consultants, independent contractors, temporary employees and project teams.
For over 70 years, Yoh has provided the talent needed for the jobs and projects critical to our client’s success, by providing comprehensive workforce solutions that focus on Aerospace and Defense, Engineering, Federal Services, Health Care, Life Sciences, Information Technology and Telecommunications. Yoh fulfills immediate resource needs and delivers enterprise workforce solutions, including Managed Services, Recruitment Process Outsourcing, Vendor Management Systems, Independent Contractor Compliance, and Payroll Services. For more information, visit yoh.com.
Yoh is a part of Yoh Services LLC, a Day & Zimmermann Company.
ABOUT DAY & ZIMMERMANN
Day & Zimmermann’s 24,000 employees provide industrial, defense and workforce solutions to a broad base of commercial and government customers. Operating from more than 150 worldwide locations with 2.2 Billion USD in revenues, the Day & Zimmermann family of companies is currently ranked as one of the largest private companies in America by Forbes and is a former winner of the U.S. National Family Business of the Year award. Founded in 1901 and headquartered in Philadelphia, PA, Day & Zimmermann companies today provide engineering, construction and maintenance services, and staffing services to the commercial and government sector, and munitions products, security, logistics, equipment maintenance and facilities management services to the Department of Defense, other government groups and defense industry contractors. For more information, visit http://www.dayzim.com.