Because of the COVID-19 pandemic, millions of workers in the United States had to adjust to a work-from-home setup. It meant having a safer working environment. It also proved that remote work is efficient, prompting employment experts to declare that it’s here to stay.
However, there’s a margin of workers that are growing and that many businesses might not notice. In fact, they were a growing part of the world’s workforce even before the pandemic: the independent contractors. According to Forbes magazine, there were 41 million independent workers before the pandemic. They were a varied group that, until recently, were defined as those working in the gig economy—gig workers, freelancers, part-timers, contingent workers, consultants, and even micro business owners.
Today, independent contractors are a group of workers mostly made up of white-collar employees who left their job and started working independently. While many of them are satisfied with their choice, 14 percent were forced to this setup. Often, they chose this path because of their inability to find work or job loss, according to an independent workforce management provider, MBO Partners.
Despite this, experts believe the rise of independent contractors and remote employees will help accelerate the future of work. Based on this, it’s essential for business owners to know the key trends that will shape how you will hire workers, whether today or within the next five years.
Independent Work Going Mainstream
According to MBO Partners, the independent workforce is showing positive numbers. They expect the number of independent contractors to reach 54 percent of the US labor force by 2025. On the other hand, some experts predict that independent contractors can outnumber full-time workers by 2027.
To date, there are more than 7 million skilled independent contractors, while side gig workers number more than 15 million. The good thing about these workers is that they are open to upskilling to increase their income, another trend that will continue to rise shortly.
In online gig marketplaces, hourly postings of gigs grow to a whopping 460 percent. On the other hand, 55 percent working remotely today are seriously interested in working as independent contractors.
All these numbers represent workers’ increasing aspiration to control their careers. More importantly, for business owners like you, this means that there is a need to upgrade your workforce structure to a modern business model. This way, you can leverage the use of independent workers and remain competitive in the market. In fact, one-third of organizations hire contingent workers to replace full-time employees. Indeed, independent work is gradually becoming mainstream.
Businesses Will Adopt Scalable Hiring Practices
To adapt to the changing workplace, businesses need to change their hiring processes and adopt a scalable workforce. This involves hiring independent contractors rather than full-time workers.
Businesses spend on recruiting, onboarding, paperwork, and possible turnover when they hire full-time employees. On the other hand, independent contractors allow businesses to save on upfront costs of hiring because they can be offboarded quickly and easily once they finish their jobs.
A scalable workforce can also allow your business to remain flexible. This means that during times of downturns or changing market conditions, you can reduce your workers accordingly.
The only challenge you’ll face when hiring independent contractors is the correct classification of their jobs. Misclassification of independent workers has been a significant issue in the US labor force. As such, the government imposes strict penalties on those who don’t comply. You can face millions of fines and even a business ban if you misclassify your independent workers. To avoid this situation, you must work with a business attorney to help you classify your workers correctly and avoid legal repercussions.
Traditional Employees Turning into Digital Nomads
According to some experts, the number of full-time workers who transitioned to a digital career doubled from 3.2 million in 2019 to 6.3 million in 2020. This means that workers value their health and safety more. Working in an office setup increases an individual’s risk of getting exposed to the COVID-19 virus. However, digital nomads who travel while working practice social distancing to another level, thus promoting a healthier work environment.
Attract Top Talent Today
To achieve long-term success for your business, you need to manage your employees. The changing workplace, however, can often make that challenging.
To adapt to the rapid change, you should stay ahead of the changing trends in the employment scene. Keeping yourself abreast with the current trends in hiring practices can help your business attract top talent while maintaining your current employees engaged.
These current employment trends on independent contractors can help you adopt best practices concerning your company’s hiring process. It can also allow your business to remain competitive, promoting business growth.