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The Rise of The Permanent Contract Worker

The Rise of The Permanent Contract Worker

over 1 year ago By Emily Harris
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While the value and popularity in the gig economy has steadily grown over the last few years, the uptake in contract workers increased exponentially over the course of 2020, especially within the public sector. A significant factor in this sudden increase was the increased workload of public service workers who were required to support the country’s covid recovery. However, as Australia begins to rebuild from the pandemic, will the demand for contract workers remain? Below we examine the benefits contract work provides and how to gain the most traction when looking for contract and temporary staff:

The Rise of The Permanent Temp Worker

The temporary or ‘gig economy’ has garnered more attention as a viable option for workers over the last few years, as more organisations embrace flexible working options and new business models emerge that dismiss the conventional ‘employee’. Take popular ride-sharing app Uber for example, which has an estimated 160,000 contractors picking up passengers worldwide in addition to it’s 2,000 permanent staff. Indeed, as organisations begin to rebuild and recalibrate from both the economic challenges of 2020 and the pandemic , the upswing of temporary contract work has gone into overdrive; in freelancer’s annual ‘Fast 50’ report, the number of freelance or temporary positions globally increased by 41% between April and June last year.

In addition to the consequences of covid, the application of automation and artificial intelligence technology to manual and repetitive tasks has meant many organisations have changed their labour force; relying on automation and AI for day-to-day functions and bringing in experts and consultants on a temporary basis for more complex issues.

Taking a closer look at the Australian public agencies and departments, AusTender reported that contracts for temporary workers in 2020 totalled $1.36 billion – an increase of around $500 million on the previous year. Last year also marked the sector’s lowest proportion of ongoing employees, representing 87.5% of the workforce. This increase in non-ongoing, casual staff was credited to the increased workload experienced across the public sector due firstly, to the bushfire crisis and then the COVID-19 recovery. Both Services Australia and the tax office were responsible for adding around 3000 extra staff, no doubt to cope with the sudden increase in income support and tax requests.

While workloads begin to re-stabilise in 2021 as COVID-19 recovery initiatives come into effect, the surge in temporary and contract workers is only expected to grow as the public sector realizes the value in building an agile workforce. In the release of the Australia Public Service Commission’s 2020 State of The Service report it was announced that the Australian Public Service (APS) will establish a permanent surge reserve to rapidly mobilise public service volunteers in large numbers to ensure their workforce is ready and equipped to deliver critical services to Australians during times of need. Surge reservists will be deployed for short periods, with initial terms of up to eight weeks depending on the reason for the call up and the level of urgency involved.

These trends suggest that the concept of the ‘permanent’ temp worker- where workers continually move from contract to contract- is going to become the new normal, especially within the APS as demand for contract roles increases.

The benefits of hiring independent contractors

In addition to increased demand, temporary and contract work provides numerous benefits to both the organisation and the individual contractor. In light of the turmoil and rapid rate of change across the workforce last year, many organisation’s original hiring forecasts were derailed. In periods of uncertainty, being able to hire contractors rather than permanent employees can be a great solution for organisations looking for an agile way of managing headcounts and budgets. Consequently, while organisations ride out the covid storm or recover from any financial or operational set-backs, contract roles are a viable option.

Contract workers also bring with them a very diverse and varied skillset, as they’ve had experience working across multiple organisations and systems. Their varied experience also indicates that they’re equipped to identify and resolve a greater range of issues and have developed an outside-in approach to problem solving. This can be advantageous to an organisation, as a fresh pair of eyes can observe ways to make frameworks and systems more efficient. A contract worker - especially in a specific or specialist area – brings particular expertise that is difficult to find and not necessarily required on a daily basis. This means they can fill any knowledge gaps a team might have while offering greater flexibility as the organisation doesn’t have to commit to a contractor long-term and can release them at short-notice without financial penalty.

On the flipside, contract work allows individual workers to diversify and grow their skillset and gain new experiences and opportunities through being able to work in different departments and organisations. This can be especially beneficial to those unsure about the direction of their career or just starting out, as an initial contract can open the door to further long-term opportunities with a particular company. Contract work can also offer greater flexibility which can be better suited to an individual’s lifestyles. However, one of the biggest benefits of contract work is financial; contractors are paid on an hourly or daily basis and are paid for every hour/day they work, unlike employees who are paid a salary. Their wages are typically higher than their full-time counterparts to make up for the fact that they have to surrender the right to entitlements like sick or paid annual leave.

How to attract & appeal to contractors

The challenge for organisations and companies looking for contract and casual workers moving forward is to gain traction in the marketplace as demand in the contract space grows. Differences in the needs and wants of temporary workers vs. permanent workers are subtle but still distinctive. Consequently, it’s important that organisations are aware of these needs and know how to meet them in order to effectively appeal to and attract the desired market. Because as in any form of recruitment, the aim is never just to fill a role, but to fill it with the right person.

According to Linkedin data the key factors contractors’ value when considering a job are similar to that of a permanent worker; strong compensation and benefit options, a good work life balance and positive workplace culture. In a recent Linkedin survey that spoke to U.S contractors, 64% of respondents voted for strong compensation, 59% voted for work life balance and 44% voted for workplace culture. A Harvard Business Review Talent Trends survey found similar results, claiming that contractors were more invested in salary than full-time workers and rated company culture and learning new skills within a role, highly. Consequently, for a contract role to appear more desirable to candidates, it’s recommended that organisations ensure they can meet these requirements; do they offer flexible working options to their contract workers? Can they offer competitive rates? Will contractors be entitled to professional development resources or networking opportunities with the wider organisation?

According to Linkedin’s data, contractors are also more engaged on Linkedin than the average worker; they are 1.6 times more likely to respond to InMails and 1.8 times more likely to engage with content. This makes sense as contractors need to keep a regular eye on the job market so they’re ready to pounce on their next gig. For an organisation, this insight suggests that putting a bigger focus on Linkedin as opposed to other platforms could be beneficial in reaching a bigger pool of candidates. Linkedin also suggest that if an organisation is trying to demonstrate thought leadership, their data has shown contractors engage the most with topics revolving around career growth, self-improvement, employee engagement and social media marketing.

It’s also important to remember that the recruitment process within contracting is fast-paced. Contracts are short term- sometimes 3-4 weeks- and workers want to minimise the length of time between contracts, so are always on the lookout for their next role. Organisations need to move fast to secure a candidate, especially if that candidate is in high demand. Consequently, it’s important to make fast decisions, especially when considering extending a contract or re-hiring a previous contractor.

Another key factor organisations should consider are the processes they have in place to make contractors feel like a part of the team. As Linkedin’s research demonstrates, contractors value a positive workplace culture and thus appreciate opportunities to build and foster relationships and collaborate with the wider team. Subsequently, an organisation should make sure it includes contractors in any social events or publicly acknowledge their input or impact on a project. Establishing these bonds will also go a long way in building a long-term relationship.

Finally, if organisation’s have specific recruitment needs in regards to their contract work, it can be beneficial to reach out to a recruitment organisation that specialises within your particular industry or deals with contract roles. For example, because Public Sector People focuses solely on recruiting within the public sector, a significant portion of contract roles we work on are contract roles. This focus has ensured our consultants have built strong relationships with a number of candidates and are well versed in what will and won’t draw talent to a contract role.

If you’re looking to fill a particular contract position or advice on whether contracting would work for your organisation, don’t hesitate in reaching out to our specialised consultants.

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Phone: (03) 8535 3111

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