With the pandemic continuing into its third year and hiring woes plaguing businesses across the nation, the future of the US workforce is anyone’s guess. There is a lot of unpredictability about global health, supply chains, and the economy; however, companies that have controlled what they can control and gotten creative have managed to thrive despite the challenges.
Instead of sticking to the status quo, many firms have dipped their toes into the gig economy, finding top talent that wants flexibility and remote options instead of the nine to five drudgery. As more businesses implement gig-workforce models, you might be wondering how that will affect workforce trends in 2022. We’re here to tell you and explain the top contingent workforce trends we will likely see this year.
The Top Contingent Workforce Trends For 2022
With the rise of what is now known as the “gig economy,” the job market is changing. The gig economy values short-term, temporary work to traditional employment. Gig workers are often referred to as freelancers or contractors, and they can perform anything from ad-hoc projects to regular monthly workloads. Gig workers are typically highly skilled, knowledgeable in their field, and ready to serve in a demanding environment. Freelance work is growing at a staggering rate. In 2021 alone, there were about 24 million occasional independent workers in the United States, a significant bump from the year before.
Legal Challenges
As more companies tap into contractors to fill talent gaps, the government is taking notice and cracking down. In December, the National Labor Relations Board (NLRB) announced that it would reconsider the current legal standard for determining whether workers are independent contractors or employees. A January announcement stated that the Department of Labor and NLRB would combine efforts including information-sharing and possible joint investigations on allegations of worker misclassification.
The use of independent contractors will only increase in 2022, so businesses should expect legislation in the US at the federal, state, and even local levels to register and track these workers. Enforcement will also increase to recoup potential lost tax revenue.
Pay Bumps
With historically high inflation rates going into the new year, everything costs more, including wages for contingent workers. Expect to pay more to attract and retain contingent workers throughout 2022, meaning that you may need to adjust your budgets and your pricing models. Many employers could be in for pay hikes of 5% or more this year. According to Upwork, a popular freelance platform, freelance customer relations managers (CRM) earn $50-60/hr on average, and freelance data analysts average $55-65/hr.
Remote Work
Amid the workforce exodus known as the “Great Resignation,” many companies struggle to bring employees back to the office. Others have permanently adopted remote models, supplementing remote teams with contingent workers.
Remote work will continue to rise in 2022 with technology making it easier to communicate and collaborate on work projects. With work collaboration tools such as Zoom, Google Drive, and Slack, people can work together seamlessly; geographical locations be damned. This change has led many businesses to realize that they can tap into talent worldwide on a contingent basis. The pandemic has forced firms to realize the efficiency and productivity of a remote workforce, and more companies will have the confidence to hire freelancers in 2022.
Skill-based Hiring
In 2022, businesses will focus less on hiring workers for rigid job roles and more on hiring based on their skills. Gartner says, “To build the workforce, you’ll need post-pandemic, focus less on roles – which group unrelated skills – than on the skills needed to drive the organization’s competitive advantage and the workflows that fuel this advantage.”
Skills match up to core business challenges, and how the skills a worker possesses can help the firm overcome those challenges. On the other hand, roles refer to an overall organizational structure or hierarchy, which can be limiting. Contingent workers fit into this new skills-based hiring model, as they are hired for their specific skill set, like product design, instead of fulfilling the needs of a full-time role like product design manager.
Contingent Workforce Of 2022
The world is changing and along with it are seismic shifts in the modern workforce. More employees are bucking the traditional framework of working a nine to five job and embracing freelance work with open arms. The flexibility, pay, and remote options are attractive, and businesses must take notice.
By working with an experienced team of professionals to manage your contingent labor, you can rest assured knowing your risks are being reduced and handled daily. NexusCW keeps up to date with the latest legislation compliance to help you work your contingent workforce program properly.
