Why freelancers are becoming vital for South African businesses

29 May 2018 - 12:00 By Vincent Solomon
Contingent workforce to increase employment.
Contingent workforce to increase employment.
Image: 123RF/Jakub Jirsak.

In uncertain economic times, businesses are required to be flexible and proactive in their hiring strategies to ensure relevance. Making use of a contingent workforce can help businesses to adapt and react timeously to both internal and external conditions.

A contingent workforce is defined as a labour pool whose members are hired by an organisation on an on-demand basis. This could include freelancers, independent contractors and consultants, for example.

“As the contingent workforce continues to grow, so do the challenges to businesses - such as managing costs, standardising processes and tracking performance,” explains ManpowerGroup South Africa’s managing director, Lyndy van den Barselaar.

Results from Deloitte’s 2017 Global Human Capital Trends report indicate that millennials value freelance flexibility with full-time stability. Globally, employers are increasingly offering flexible working arrangements as part of the employment experience, while globally, 8 out of 10 respondents believe demand for skills is driving a trend toward greater use of contingent workers.

According to the Statistics SA employment outlook, the number of permanent, full-time employees has fallen from 11 million to 9.1 million in the past decade. The statistics for temporary employment are not fully up to date, but so far the number has risen from 2.6 million to 3.9 million.

“Whilst it is evident that a changing attitude among employees is also driving the contingent workforce trend, there needs to be a strong understanding of objectives amongst both employees and employers so that the relevant skills are aligned with the changing work landscape,” says van den Barselaar. “As the number of contingent workers rises, in additional to requiring a mind-set shift on behalf of both employers and employees, it also requires an adjustment to training, induction and workforce management policies.”

What organisations need is workforce solutions that optimise contingent workforce management and drive performance through the use of people, processes and technology in order to develop, deploy, and enable an integrated approach to analysing and managing contingent talent.

“Contingent workforce solutions should be designed to manage all contingent workforce activities (from sourcing to separation), support administrative functions by establishing performance metrics, negotiate SLAs, evaluate vendors, standardise reporting and manage day-to-day operations,” states van den Barselaar. Contingent workforce management solutions add value by delivering results that increase workforce efficiency, compliance, cost savings and mitigate risks – while ensuring the business goals are achieved.

“Businesses need to ensure they have sound policies and strategies in place for the on-boarding and management of contingent workers. While these workers may not be on the payroll, their rights need to be respected,” explains van den Barselaar. She notes that contingent workers should still be made to feel part of the team, and should be immersed in the company’s culture.

“The contingent workforce is important in developing economies like South Africa, as there are many job seekers who cannot find permanent employment, and this can provide relief for them. Furthermore, the availability of contingent workers allows local businesses a flexible solution when they need it most. Having specific strategies in place around the use of the contingent workforce needs to become a priority – and quickly – for any business operating in today’s ever-evolving business environment,” concludes van den Barselaar.

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