Employers are expecting to use an increasing number of contingent workers and correspondingly decrease their reliance on full-time employees, according to new research by Willis Towers Watson.
The research surveyed more than 1,000 organizations in 40 countries on the changing world of work and adoption of digital and automation technologies in the workplace. It found contingent workers, such as freelancers and free agents, and employees on loan from other organizations currently make up 4.2 per cent of workforces. And that’s expected to grow to 5.2 per cent over the next three years.
Meanwhile, survey respondents said they expect their workforces to be 76 per cent full-time workers, down from a current 80 per cent.
“The increasing sophistication of the skills that contingent workers possess and the work expected from them, combined with the growing premium placed on speed, is encouraging more organizations to consider the use of contingent talent, which can frequently be more quickly sourced, onboarded and deployed productively to specific projects than traditional employees,” the report said.
One in four organizations said they’ll make more use of contingent talent because of automation and digitalization, with that number expected to more than double in the next three years to 51 per cent.
Three years ago, seven in 10 organizations were already using contingent workers and, as a result, have a higher percentage of contingent talent in their workforces. Among employers that have used contingent employees for more than three years, their workforces are made up of freelancers (8.3 per cent), workers on loan (7.1 per cent) and freelancers from talent platforms (3.7 per cent). Those numbers are expected to rise to 9.2 per cent, 6.5 per cent and 4.4 per cent, respectively, in three years.
By comparison, the makeup of organizations that started using contingent labour in the last three years is freelancers (5.3 per cent), workers on loan (3.9 per cent) and free agents from talent platforms (4.3 per cent). In another three years, those percentages are expected to increase to 8.4 per cent, 6.9 per cent and 4.9 per cent, respectively.
While the use of these types of workers is on the rise, a large percentage of employers are struggling to integrate them into the workforce. Just 41 per cent said they’re effective at this integration, while 45 per cent said they’re effective at retaining employees and contingent workers with important technology skills.
“As the use of contingent labour continues to evolve, it’s critical for companies to proactively address the new mix of workforces to effectively compete for highly skilled talent,” said Tracey Malcolm, future of work global leader at Willis Towers Watson, in a press release. “Organizations that successfully integrate contingent workers with automation and their teams are reaping benefits in the form of cost savings and less disruption in the short term.”
The survey also found:
- The proportion of work completed using automation in North American companies has doubled over the last three years, from six to 12 per cent. That number is expected to nearly double again, to 23 per cent, in the coming three years.
- The majority (95 per cent) of respondents said they expect to use workplace automation, including artificial intelligence and robotics, within three years.
- Only 14 per cent said they’ve integrated a digital and business strategy and roadmap.
- Three-quarters (75 per cent) of respondents said leadership development is crucial for organizations’ ability to successfully manage automation and digitalization.