How to Get Independent Professionals into Your Company’s Contingent Workforce Plan

As technology proliferates and enables new working and labor arrangements, more U.S. professionals than ever are making the switch to full-time contingent or contract-based employment, according to a report by MBO Partners.

Alongside advances in artificial intelligence, Deloitte has identified growth in use of these “off balance-sheet workers” as one of the most impactful trends shaping the future of work, the study said.

The MBO study said that solution provider SAP Fieldglass and Ardent Partners each found that over 40% of the average corporation’s workforce as being comprised of nonemployee labor, while noting that a decade ago that figure was just 16%.

MBO Partners studied this trend in its “Client of Choice Report 2019,” exploring the changing needs and expectations of these independent professionals and what corporations are doing to attract and retain the best talent in this emerging labor market.

The study was compiled from responses to an online panel-based survey by 3,584 U.S. residents age 21 and older. Of those respondents, 1,148 were independent workers, and 513 met the criteria of independent professionals.

Independent professionals are distinct from other contract-based workers, the study said, defining them as someone who provides a service to a business and who makes $78,000 or more a year.

They tend to be better educated and older, with 76% having four or more years of college, substantially greater than the 41% reported by all contract or gig-based workers. Nearly a third have graduate degrees, and the average age was 48 compared with 41 for all contractors, the study said.

While independent workers of all types have grown in number over the past 10 years, this group of high earners has grown even faster — from 4.5 million in 2011 to 7.4 million in 2018.

When asked about their motivations, more than two thirds of respondents reported either more control over their schedule or greater work-life balance as a top reason for pursuing an independent career, while 49% cited earning more money.

The need for independent professionals will likely keep pace with workers choosing to take this route, as examined by Steve King and Gene Zaino in the Harvard Business Review.

'Difficult to Source'

The MBO study states that independent professionals work in many different industries, providing knowledge-based services and skills that are in high demand that existing labor markets are typically unable to accommodate.

“The common denominators are two-fold: Their work is knowledge-based and their skills are often difficult to source through traditional labor markets,” the study said.

Roles like consulting, coaching, research and creative services are the most popular, with a smaller proportion lending their expertise in fields like education, sales and marketing, and healthcare.

How Do You Keep Them?

Given substantial leeway to choose their clients and working hours, it’s no surprise that 86% of independent professionals report being satisfied or highly satisfied with their work — and 71% said they’re optimistic about the future of their careers, and just 23% responded that they would prefer to return to a traditional job than continue working independently, according to the study.

As the demand for the skills and services of independent professionals continues to grow, so too does their autonomy and ability to make choices about which companies to work with and for what reasons. Keeping these professionals satisfied can be challenging, especially for organizations that have less experience communicating with and accommodating working styles outside the existing corporate structure.

This matters because 85% of these workers report being satisfied or very satisfied with their client relationship, and just 1% report being unsatisfied. The message is clear: Unsatisfied workers will not continue working with a client for long, and they increasingly have options that allow them to seek improved conditions if existing relationships don’t pass muster.

Respondents to the MBO evaluation identified key areas that make a difference in their client relationships — with 90% of independent professionals said it was important to be treated like they’re part of the company that’s hired them.

Within the legal limits of their independent status, these professionals want to be included in activities, schedules and goals of the project they are supplementing, and they appreciate regular feedback and performance reviews to navigate often unfamiliar working cultures and refine their own services.

This desire leads into another key point for independent professionals: 82% said it was important to them to be able to learn new skills and expand their capabilities as they work and that it impacted their choice of clients.

Clerical and procedural factors related to submitting work, communication with clients on issues like the on-boarding processes and key policies, and receiving pay fairly and quickly had a major impact on professional’s satisfaction with their clients, with 92% responding that procedural factors like these are important when dealing with clients.

The most important factor when considering their satisfaction, however, was that independent professionals felt their work was valued by their employer. Some 96% of respondents listed feeling valued as important to their satisfaction with a client, and it was the No. 1 factor when deciding with whom independent professionals would prefer to work.

Millennials are Aging

The MBO study focused on independent professionals but had this passage about Millennial-age workers:

“Having displaced Baby Boomers as the largest cohort in the workforce, Millennials remain a source of some mystery to employers. Widespread assumptions hold that Millennials have fundamentally different motivations, concerns, and desires than the cohorts that preceded them in the workplace. But in our survey, we found that as Millennials mature (the oldest Millennials are approaching 40), their attitudes toward independent work line up quite well with those of the population at large.

“One major exception is their views toward technology. About three-quarters of Millennials (76%) say they are quick adopters of technology as compared to 62% of non-Millennials. They’re more likely to use online talent marketplaces to find work (24%) than older cohorts (11%) and are more positive about how automation technologies and AI are impacting their work, careers and lives. Organizations that provide access to up-to-date digital tools and technical infrastructures will be more attractive to Millennial independent professionals.”

For more on the contingent workforce, see John Rampton’s piece that takes a closer look at keeping independent workers engaged and satisfied, in Entrepreneur.

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First Voice

  1. Amy:

    I think it’s small and mid-sized companies that stand to benefit most from independent procurement professionals — only large companies can afford to have purchasing experts on payroll, and even then not always for indirect or non-critical categories.
    Online ”matchmaking” platforms can help, but finding someone with market knowledge in a specific category and region is like finding a needle in a haystack, and while the more ‘up-market’ platforms like Catalant and Talmix can help you find the right expert even a short engagement will cost $20k or more.
    Solutiam.com looks promising. I can’t find too much info about it but it looks like the experts are vetted, reports are made to order, and the price is reasonable. Anyone have any experience with it?

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