Not so long ago, freelancing was considered a desperate measure for cash-strapped workers who were looking for their next job. But today as large companies embrace a business model where the traditional job is transforming, corporate freelance careers are thought of as possible hot opportunities for ambitious professionals.
A new global study by Deloitte found that 42 percent of U.S. executives predict that they will use more contingent workers in the next three to five years. Approximately 51 percent of executives expected to hire more freelancers during that time frame, and only 16 percent predicted that they would hire fewer freelance workers.
Deloitte’s report explains that in the new open talent economy, large companies are forming teams that are “on and off the balance sheet.” Freelancers are increasingly playing major roles in companies, and employers are realizing the importance of viewing them as part of the company culture, keeping them engaged, and managing this type of talent effectively. In the report, more than 70 percent of executives and HR leaders ranked the gig economy trend as important or very important.
Filling corporate freelance gigs is a growing number of knowledge workers, including Ph.Ds, physicists, and specialized engineers. Companies in industries such as pharmaceuticals are starting to rely on freelancers to develop products, and investment banks look for outside consultants to guide deals.
The Reason Behind The Changing Attitude
Corporations are changing their attitude towards freelance workers because more and more Americans are falling into that category. Today, according to a study by the U.S. Government Accountability Office, approximately 40 percent of the U.S. workforce has a contingent job, such as temping, freelancing, contracting, or a part-time job. With many industry experts forecasting that the percentage of freelancers will increase to at least half of the U.S. population, the U.S. government recently re-introduced the Contingent Worker Supplement, to take an official head count.
Industry experts believe that the growing numbers of contingent workers reflects the preferences of both companies and workers. Workers appreciate the benefits that come from freelance work, such as flexibility and excitement of working on new projects at different companies with new people. And companies enjoy benefits, such as cost effectiveness in hiring freelancers for specialized projects and greater access to new talent. Cost structure is a major factor driving the trend, as some companies prefer to pay purchase orders instead of salaries.
Companies are now trying to determine how to best use corporate freelancers to improve the productivity of their internal staff and increase profitability. Many firms are struggling with the challenge – only 19 percent of executives surveyed believed that their companies fully understand the labor laws that govern contingent workers, and only 11 percent have complete management processes for this segment of their workforce. Deloitte suggests that companies need to take a more deliberate approach as the size and scope of the contingent workforce continues to grow.
Deloitte advocates that corporate executives should not only be thinking of creating a great work experience for employees of the company, but also about creating a great experience and engaging freelancers, third-party contractors, and others who are a key part of the services delivered to customers.