5 top tips for contingent worker retention during an economic downturn
The job market has experienced a significant shift over the last few years. Vacancies in essential sectors like healthcare have hit record highs, the ‘quiet quitting’ phenomenon is in full-force and economic conditions are leading employees to reconsider their priorities at work.
As businesses navigate this period of rapid and regular change, employee retention is at the top of the agenda. Yet the retention of contingent workers continues to be a challenge for many. Overlooking retention of this workforce is a mistake as, when effectively executed, contingent worker retention strategies can drive operational success.
What is contingent worker retention?
Many talent managers are not currently prioritising the retention of their contingent workforce, for a variety of reasons. Primarily, businesses can fail to even consider contingent workforce retention, as the phrase itself sounds like a contradiction. Contingent workers are those who are not on an organisation’s permanent payroll, instead providing independent services for a contracted period. HR leaders could be viewing their contingent workers as a one-off solution to plug an immediate gap, rather than a key labour force that could return time and time again.
Especially within the context of the current economic downturn, retaining a contingent labour force can be a lifeline for businesses. As companies potentially experience financial difficulties, flexibility is key to ensuring that they can operate in a way that is financially efficient. Having access to a pool of contingent workers allows organisations to be flexible, as they can regularly draw upon their engaged contingent workforce to fulfil business needs.
Managing contingent worker retention requires a strategy that goes beyond traditional staffing. Many businesses currently take a ‘capture and release’ approach to their contingent workforce, whereby they hire workers for a designated period, who then move on to their next assignment with another company. In doing so, businesses could be losing out on top-quality employees, and investing significant resources in someone who is unlikely to return.
Retaining contingent workers requires a shift in mindset to a digitally enabled ‘attract and engage’ approach. Businesses may already have a strong value proposition to attract candidates but this must be followed up with a data-driven retention strategy.
Contingent worker retention begins early in the sourcing process with managing the candidate experience. Those who source their candidates through staffing and recruitment agencies can try to manage candidate experience through supplier selection, supplier relationship management and ongoing communications. Organisations should try to have the greatest influence possible over their candidates’ experience, but this can be limited when working through a third-party sourcing provider.
Alternatively, organisations can opt to source their candidates directly. This alternative can be valuable, as it allows businesses to have greater control of the candidate experience. When using an integrated direct sourcing platform candidates enjoy an improved user experience, thanks to quicker screening, interviewing and selection. Additionally, candidates feel more in control of the process and as such are more likely to return to the company time and time again
Once contingent workers are onboarded with an organisation they cannot be forgotten. The likelihood of retaining contingent workers increases significantly when an employer builds an environment that values them.
Creating a contingent-friendly culture is all about communication. In the early stages businesses must offer an onboarding process that introduces the worker into a welcoming culture and work-enabling environment. Following this, leaders should implement regular communications and check-ins with contingent employees to resolve any issues and prevent early employee turnover.
Especially during the current cost-of-living crisis leaders should assess what benefits are currently being offered to their contingent workers. Given that contingent workers do not generally receive the same perks as permanent workers, creating a strong benefits offer for contingent employees could be an effective way for businesses to be competitive. In turn, this is likely to positively impact employee retention, as workers are more likely to choose to return to the business that gives them the best deal.
Contingent workers can be seen as a temporary labour force, engaged for a short time before they move onto different projects. Yet the more employers redeploy their contingent workers, the more they are likely to keep returning time and time again. By monitoring assignment end dates and worker skills, specific workers can be retained in other suitable roles within the organisation.
Contingent workers can complete an assignment with a business and move on to another project without ever returning to that first business. If organisations want to leverage contingent talent for the long term, contingent worker retention should extend beyond individual assignments. One way organisations can do this is by creating a talent community of ex-contingent workers and regularly communicating with them. Such communications should allow workers to stay up to date on new opportunities, stay in touch with business developments and access training opportunities.
Executing a new contingent workforce retention strategy
Thoughtfully deploying contingent worker retention strategies provides a golden opportunity for organisations to achieve cost and performance benefits. When retaining contingent workers, companies can enjoy quicker sourcing of quality contingent workers, more efficient use of resources and increased job satisfaction for the contingent workers.
Executing contingent worker retention strategies requires developing new processes enabled by integrated data analytics and AI. A third-party partner that has already invested in all these capabilities and corresponding expertise can make implementation of these strategies fast and cost-effective. Organisations can therefore begin to count on their existing contingent workers for the long haul, in order to drive efficiency and achieve business success.
Simon Noble, pictured below, is SVP EMEA at workforce management platform provider Magnit