With the current changes in the market today, businesses are more focused on the ways to meet the demands of their customers, irrespective of the new way of working of their remote employees and hybrid workforce. Maintaining mental health and providing more flexible remote work arrangements becomes imperative in order to attract and retain top talent.
A survey conducted by Glassdoor suggests that around 89% of their users are either looking for jobs or considering switching careers in a search for better opportunities. Further, the study reveals that lots of job seekers are already more interested in the gig economy by supplementing their current income with gig work. About 19% of all workers are already classified as short-term workers, contingent workers or 1099-Misc (or freelance, contingent, contractor). The actual percentage is likely to much higher as lots of people were forced to take pay cuts or work reduced hours due to Covid-19 outbreak.
On the other hand, businesses face unprecedented uncertainty. While technology-driven businesses empowering remote work thrive, most family-owned restaurants, caffees, bakeries and convenience stores face bankruptcy. The never-ending cycle of lockdowns and reopenings makes it impossible to forecast revenue streams and retain full-time employees. To stay in business and survive, business owners need to increase flexibility and rely on workforce on-demand.
Why do companies prefer Contingent Workers nowadays?
The answer is simple here, contingent workers are more specialized in their field and available on-demand when the business is growing. To compete in a tight market, independent consultants and gig workers develop specialized skill sets that are unlike the broader competencies of long-term employees. In fact, independent contractors and freelance workers are often the most highly skilled and educated members of the workforce.
The CEO of Transformify, Lilia Stoyanov said: “Freelancers and independent consultants usually perform better as they have an entrepreneurial mindset and see every assignment as an opportunity to develop a long-term partnership with the client. Client references are the '' currency” of the gig economy and can secure a steady stream of new customers. Most independent consultants and freelancers understand that their reputation is directly correlated to revenue growth and are ready to go above and beyond to address the requirements of their clients.''
As technology enhancements empower the future of work, the style of working will also change. As more and more talented workers shift to1099-MISC work environment, it has become important for companies to adapt their human resources planning and workforce management strategies. Even in uncertain times, the most talented workers have negotiation power and demand working arrangements that support their well-being, allow them to spend more time with their families, commute less or work and travel.
The Future of Global Work
While businesses struggle to adjust to remote work and hybrid working arrangements, it is clear that the 9 to 5 office hours and long daily commutes will soon be a thing of the past. If 5 years ago there were concerns regarding productivity, security, technology infrastructure and the list goes on, the last 2 years forced all businesses to find solutions instead of repeating the same excuses over and over again. Hiring international contractors and employees and tapping into talent pools on the other side of the globe are becoming a norm. Inevitably, new HR software solutions are needed to streamline and automate payroll, invoicing, talent acquisition and payments to international contractors and employees.
The next HR software cloud revolution is here
Not tomorrow or next year or next five years but now. And it is known as the freelance management system. As businesses need an increased level of flexibility to survive and thrive, international contractors and contingent workforce often comprise more than 60% of the workforce. Some innovative technology businesses rely solely on freelancers on-demand to run their businesses. Needless to say, any shift towards new ways of working requires proper process design and automation. In the past few years, companies providing payroll for international contractors, EoR ( employer of record) solutions, workforce management, payments and billing automation saw rapid growth. Remote.com, Transformify, Deel, Shortlist all thrive due to the increased demand for workforce management solutions empowering global work.
Hiring international contractors and requires companies to stay in compliance with an extremely complex regulatory framework across the globe. Shall the new hire be classified as an employee or independent service provider? How to ensure that the intellectual property of the company is protected if the team is spread worldwide? How to manage payments in various currencies and ensure that the invoices issued by international contractors are in line with the tax legislation?
These are just a few of the challenges faced by those businesses willing to source talent internationally. It comes as no surprise that market opportunity was immediately identified by innovative technology companies like Transformify that immediately addressed the needs for a workforce management system that can streamline the end-to-end process from talent acquisition, to billing and payment automation, to data reconciliation and integrations with the various systems the customer might already have in place. As most companies hire a diverse workforce that comprises of full-time employees, international contractors, temporary workforce and seasonal workers, a contemporary workforce management system needs to offer an ATS / applicant tracking system/, FMS / Freelancer Management System/ and vendor management all-in-one.