Millennials Transforming the Traditional Workplace Into a More Dynamic One


Services procurement professionals should start thinking about the enormous generational shift approaching. Millennials are the largest cohort the U.S. has ever seen, and by 2025, they will make up nearly half of the working population, according to Frost and Sullivan research. However, a growing number of them are also turning to freelance work, which will continue to change the way companies interact with their employees.

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This topic was discussed in a recent webcast put on by Frost And Sullivan, “The Future of the U.S.: How Social Trends Will Affect Businesses In America.” During the event, a group of panelists weighed in on how millennials will interact with companies and what changes they will demand businesses to make.

Chris Arkenberg, research and strategy lead for Orange Silicon Valley and a panelist on the webcast, said 38% of millennials are freelancing. This is a stark contrast to previous generations, who were accustomed to long-term or even lifetime employment. This “freelancing economy” is causing a fundamental shift in the labor market, Chis said.

Shifts in Communications and Technology

Millennials want flexibility, something freelancing work is able to provide on perhaps a higher level than typical salaried positions. Workers in this generation want to be able to choose where and when they work, Chris said. They also have a very different mindset from earlier generations. As “digital natives,” or having grown up surrounding by technology, millennials are used to living in a very connected, social and collaborative world, he said.

As a result, millennial workers and freelancers are making new demands of employers. For one, they want more transparency as well as a higher level of communication. This is causing companies that were traditionally more secure and private to make a shift in how they go about internal messaging, Chris said.

Technology is also a significant driver of the rising freelance workforce. New technology platforms are emerging to help employers and freelancers engage and collaborate. Elance-oDesk, now known as Upwork, is just one of such platforms Chris mentioned, matching freelancers with the right employer and vice versa.

Our own Spend Matters analyst, Andrew Karpie, is a recognized expert in this field. He added that whether permanent employees or freelancers, millennials think of every job as a “gig,” where compensation and learning may carry more or less similar weight. And when the “gig is up,” the gig is up. So this also places new demands on employers who must calibrate their talent management for a more liquid workforce.

Andrew also noted that the number of what he calls work intermediation platforms (WIPs) has grown to more than 300 today worldwide from about 20 in 2005. Andrew also notes that “such technology and digital native millennials probably equals an ongoing acceleration of more and more fluid work arrangements with businesses — transformation of the traditional workplace into a more dynamic and fluid one.” Overlay this with the normative dimension of millennials seeking more and more collaboration, sociality and transparency in their jobs, Andrew added, and you have a set of new challenges that businesses face in managing a productive workforce.

Looking Ahead

Spend Matters has been arguing strenuously that contingent workforce managers cannot ignore this growing population of independent workers, many of whom will be millennials who may very well shun working through traditional staffing suppliers. Andrew’s advice: Procurement practitioners must start seriously thinking about and acting on the challenge of dealing with a world of work being transformed by millennials, their being part of this increasingly critical independent workforce, and their de facto technology. As Andrew said, “It’s not your grandfather’s workforce.”

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