In any given week, my team and I speak with 200 to 250 contingent workforce professionals from the CWS Council. This level of interaction enables us to identify and get ahead of trends, spot innovation in its earliest stages and identify small regional risks before they become global catastrophic ones. Sometimes, we see recurring themes in our discussions with program managers, which we then incorporate into our research, conference themes and webinar topics. For the past few months, this has given us some unique insights as far as what some of the most pressing current challenges companies are facing in hiring and by extension, challenges confronting the global workforce as well. Here are just a few of these more recent insights.
Talent is winning the war. We are in a unique time with regard to the evolution of the global workforce. Specifically in the US, where for the first time there are more job openings than there are workers, according to the latest data from the Department of Labor. This creates a number of unique challenges, not the least of which is the existential challenge facing program managers as they try to curry favor with suppliers and candidates alike to work for them. Terms like contingent value proposition are becoming commonplace as companies seek to become attractive places to work for the holistic workforce as opposed to simply full-time hires.
Direct sourcing is hot. Direct sourcing refers to the process by which a company leverages its own internal candidate pool (i.e., former employees, retirees, applicants from within its own applicant tracking system) to place within the company as temporary employees. These temporary employees are most often placed on the payroll of a third-party payroll provider. Direct sourcing essentially cuts out the middleman — the staffing agency —as companies leverage technology to engage talent directly. In doing so, companies seek to improve their talent perspective, improve attention, and, of course, save money.
As we saw in research for our VMS/MSP Competitive Landscape report series, direct sourcing is an incredibly hot topic and nearly every MSP and VMS that we reviewed had some form of direct sourcing strategy — whether in the form of partnerships or assisting companies in building their own talent pools directly. While all of this sounds promising, the landscape is littered with failed direct-sourcing initiatives, with a few notable exceptions. In my opinion, this can be a truly disruptive strategy, but as with all workforce strategies, it can be more complex than market hype may make it appear.
Fewer suppliers is better. In the past, as companies engaged MSP and VMS programs, they would allow dozens, if not hundreds, of suppliers to compete for business — the logic being with all of the suppliers being engaged through one MSP, why would it matter? Some 20-plus years later, program managers are realizing that suppliers may not be invested in being strategic partners when they are competing against such large supply bases. Also, supplier rationalization efforts often go hand-in-hand with aggressive pricing schemes as suppliers will often trade margin in exchange for having less competition. Further, program managers are realizing that strategic relationships, which are possible with fewer suppliers, can be much more productive tactically than ones with many. This is a fantastic sign of maturity in contingent workforce management as a discipline.
Obviously, this is not an exhaustive list. Topics like statement of work, IC compliance, light industrial, and contingent RPO also get a lot of air time. But this list speaks to what is top of mind for many program managers, and what challenges are in store for the workforce of tomorrow.