Looking ahead and planning for an array of outcomes is an important risk management practice and opportunity for businesses. When it comes to workforce forecasting, the shift we’re currently going through is palpable. The future of work is going to change in terms of increased remote work, increased flexibility from companies, and a potential rise in contract workers.
It’s common for contractors to pay their own taxes, and hold their own insurance because they work for multiple projects within a shorter time frame. This independence from contractors can be attractive to companies with smaller budgets, or for those looking for occasional or temporary help.
The Virtues of Hiring Contractors
Hiring contractors can save money, time, and help your business get your final product or goal sooner. If a company hires an individual for a 3-6 month project on a contract basis, it creates space for a trial period in the relationship, which often benefits both parties. Contracts allow for companies to have peace of mind without a long-term commitment.
Why does it matter? For hiring managers, the recent shift from in person interviewing to virtual interviewing creates additional challenges when feeling secure about the individual they want to hire. It can be difficult to feel fully confident in a hiring decision without meeting someone face-to-face. Hiring on a contract basis allows time for that relationship to form. If you’re creating a workforce forecasting plan, our data suggests an upward trend in contract work today, and moving into the rest of 2020.
To remain compliant with government agencies and the IRS, 1099 and W2 forms must be filled out properly according to the type of work the individual does. Back in 2000, the now famous Microsoft lawsuit is one example of the full-time versus contractor blunder companies can walk into. We recommend seeking legal counsel to have all your ducks in a row if you are hiring contractors for the first time.
Company Culture And Benefits Matter
It is also important to be aware of rising concerns in the tech industry around hiring contractors in terms of worker’s rights, who is eligible for benefits, and upward mobility. Does your company have great benefits to offer an incoming candidate whether for a full-time or contract position? Do contractors have any access to equity, perks, or benefits if they are working for your company?
“At the end of the day, there is no substitute for engaged, effective, long-term talent. Despite the potential cost savings that a contractor can provide, if you fail to make contractors feel engaged and connected to your company, the drag on culture and momentum can actually be more costly than the immediate savings that contractors bring in the short term.”
Ultimately, the workforce is changing in a lot of respects. Regardless of recent times escalating remote work operations, more and more companies were already moving to a remote arrangement. This impacts all new hiring for full-time and contract workers. As work life itself changes, we hope this resource opened the conversation about what it looks like to hire on a contingent basis. Reach out to our team today for more details and ways we can help grow your team.
Here at BWBacon Group, we know and live what you are experiencing as an employer or job seeker in Denver, Boulder, Dallas, San Francisco, New York City or any of the other cities we work in. We believe great recruiting starts and ends with understanding people.
If you have any questions about living, working or playing any of the areas we serve, please contact us. We are happy to help. Seize the day, every day, that’s what we say!