In 2020, business-as-usual took a sudden detour due to Covid-19. A combination of travel restrictions, supply chain disruption, and business slow-downs and shut-downs led to employee furloughs and layoffs. By September 2020, Pew Research found that 25% of US adults reported that they or someone in their household had lost a job, and 32% reported a reduction in hours or pay due to the pandemic.
Almost simultaneously, grocery stores, online retailers and quick-service restaurants went on hiring sprees to fulfill increased demand for touchless delivery. Domino’s, Pizza Hut, and Papa John’s, for example, added more than 50,000 employees collectively to their workforces. The sudden expansion contributed to 33% growth of the gig economy.
Meanwhile, after years of mixed results from remote work experiments, many companies had to quickly shift to fully virtual offices to accommodate social distancing mandates and ensure the health and safety of their employees and clients. CNBC recently reported that within the next four years, the number of remote workers in the US will reach 36.2 million, an 87% increase over pre-pandemic numbers.
Contingent workforce poised to grow
These factors are certain to accelerate the expansion of the contingent workforce. While a third of those who reported being laid off have since returned to work in the same job, Pew Research says half of those who lost a job earlier in the year remain unemployed or under-employed as of September. Contingent work expands work options of this population, offering flexibility for individuals with in-demand skills.
Hiring to meet demand is a cost-effective option for businesses. A contingent workforce enables resilience when an organization needs to augment existing resources to meet a sudden spike in demand or to fill talent gaps. Until the Covid-19 vaccine rollout reaches a critical mass, however, companies will also need to have effective end-to-end testing programs in place to protect on-premises workers and the people they interact with.
Companies have found success from the work-from-home model. Now that they’ve invested in more digital communication and collaboration tools, they have greater confidence in the process and are ready to hire the right talent, wherever they are. Many may be on a freelance or contract basis.
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Focus on flexibility. Organizations that want to take advantage of the contingent workforce trend need to prepare for the challenges they will likely face. According to SHRM, recruiting is one of the top concerns for HR professionals in 2021. As reported, an American Staffing Association survey found that 80% of respondents planned to look for new jobs in 2021. The takeaway: now is not the time to cut corners on background screenings or onboarding.
Many recruiting tactics need to be reimagined or created to support a resilient, contingent workforce. We’re seeing recruiters and hiring managers leveraging aggregate data points to focus their hiring and retention efforts on quality candidates. Employers and staffing firms want tools that offer convenience and automation, allowing employers to modernize and simplify their hiring processes.
Staffing and managing a hybrid workforce presents unique challenges for HR professionals striving to create a smooth process for those onboarding both remotely and in-person.
As a result, where possible, digitizing the process and integrating identity verification into the background check process becomes foundational. Identity verification will become a critical aspect of background screening in 2021. Increasingly, we see staffing companies implementing their own minimum screening packages rather than matching client requirements as was historically the case. For example, many staffing companies are including a sex offender search for all contractors, even if their client does not specifically request this search. The risk now is higher; therefore, the approach is different.
To learn more, download Sterling’s Contingent Workforce Screening Overview.