The exponential pace of technological change and the pandemic-induced shift to remote work have revolutionized the talent landscape forever. Business leaders are scrambling to adapt amid the Great Resignation. Those who can’t adapt are getting left behind. Don’t be one of them. At People2.0, we want to help you modernize your talent acquisition strategy.
In this blog post, we’ll cover ways to use your employer brand to modernize talent acquisition strategies and leverage direct sourcing for contingent talent. We’ll also define global talent marketplaces and go over the ways talent acquisition leaders are leveraging them to drive speed and agility.
Prelude to the Revolution
Over the last several years, advances in technology have increased worker freedoms and allowed more people than ever to work remotely. During the COVID-19 pandemic, lockdowns made remote work a necessity for a much larger portion of the working population. Work-from-home adaptations became essential, which exponentially accelerated the growth of remote work technologies and the remote workforce.
As opportunities for greater freedom increased, skilled workers started leaving less flexible jobs in what has become known as the Great Resignation. This mass exodus from the nine-to-five grind shows no signs of stopping, and businesses are feeling the squeeze. According to the Fall 2022 Fortune/Deloitte CEO Survey, talent is a top priority for CEOs, second only to inflation. As many as 71% of CEOs expect talent shortages to continue.
Fortunately, technological advancements have also increased access to a global workforce and made borderless talent acquisition strategies viable for most businesses through contingent labor, or as we at People2.0 sometimes call it, the independent workforce.
The Contingent Workforce
Contingent or independent labor is a broad term used to describe temporary workers or workers who provide services for a company but are not formally employed by that company or on their payroll.
The independent workforce is often overlooked, but more and more companies are recognizing its potential. The gig economy makes up a large and quickly growing part of the global economy. According to Ardent Partners, one-third of enterprise total workforce currently fits under the broad category of independent work, and that number is growing. In 2021, the global spend on independent work was $5.4 trillion. Many tech giants have recognized the potential of independent work, and Google currently has more contingent workers than full-time employees (FTEs).
Categories of Independent Labor
Independent labor comes in many different forms, but it usually falls into one of the following categories as defined by Staffing Industry Analysts:
- Temporary staffing refers to the services provided by a staffing agency to an organization. In these arrangements, the agencies recruit, screen, sometimes train, and place temporary staff. Although temporary staffers provide services to the organization in which they are placed, they usually remain employed by the staffing agency.
- Directly sourced contingent workers are independent workers who are sourced from an organization’s internal talent pool. This includes but is not limited to summer interns, seasonal workers, and retirees.
- Independent contractors are self-employed and work under a contract with an organization.
- Statement of work (SOW) consultants are hired by an organization under an SOW document which typically defines a fixed price for deliverables or for hitting specific milestones.
- Freelancers from digital platforms contract services with an organization through websites or other digital platforms. These digital platforms do not take responsibility for tax or social insurance obligations of the workers.
- Professional staffing, also called “specialist staffing,” is the segment of temporary staffing that includes IT/technical, engineering, accounting and finance, legal, sales and marketing, and managerial workers.
Direct sourcing is one of the hottest topics in contingent labor management and has ascended the C-suite priority list into the top three over the past five years. Direct sourcing is when a company leverages its own brand to source, engage, and manage contingent workers. The rise in direct sourcing can be directly attributed to the advent of purpose-built direct sourcing technologies that enable an organization to build, segment, and communicate with talent pools of various types based on their known gaps in skills and/or capacity. This allows a company to rely less on outsourcing recruitment functions and empowers them to build a range of on-demand talent pools that they engage with consistently over time.
Global Talent Marketplaces
Talent marketplaces come in two types: business-to-business (B2B) and business-to-consumer (B2C). B2B marketplaces like UpWork, Braintrust, and Talmix match and deploy freelance workers from all corners of the globe who specialize in particular facets of business that often fall into creative, IT, and business strategy buckets. B2C marketplaces like Lyft, Task Rabbit, and Instacart match independent drivers or other task-based workers directly with consumers who need a specific, commoditized task completed.
As an organization, you will most likely work with a B2B talent marketplace. In order to succeed in this endeavor, you will need six things:
- Organizational readiness, which includes stakeholder buy-in and investment into talent transformation efforts.
- Executive sponsorship because top-down investment, advocacy, and targeted messaging are all very important to success.
- Partner selection so you can find technologies and services that align with the organization’s problems and existing infrastructure.
- Change management because changing behaviors is challenging, so a thoughtful and sustained communication and change management plan is critical.
- Compliance to ensure that the appropriate service providers are integrated and capable of paying workers compliantly in the geographies where they reside.
The COVID-19 pandemic has reshaped all of our worlds, and the talent landscape was no outlier.
The exponential increase in remote working technology has allowed most businesses the opportunity to access a global talent pool. Tools like direct sourcing and talent marketplaces can break down compliance barriers that may stand between organizations and independent workers.
As more companies use direct sourcing and talent marketplaces to quickly acquire highly qualified talent, companies that fail to adapt will find themselves left behind.
If you’re ready to unlock access to unlimited growth, People2.0 can help. As the world’s largest employer of record (EOR) and agent of record (AOR) provider, we connect you to a world of talent.