Monday, January 18, 2010

Contingent Workers Will Lead the Way


A recent article from Investor’s Business Daily reports that companies are still risk-averse when discussing their staffing plans for 2010. To reinforce their wariness we can simply look at the most recent jobless claims report. During the month of November we saw a leveling off of jobless claims, and a trend started to emerge, fueling hope that perhaps soon we’ll be seeing the addition of jobs to the market and the light at the end of the proverbial tunnel. But then the first January report was released which discounted our initial optimism. Jobless claims rose once again by nearly 11,000, breaking our 4 week streak. Our final jobless claims now idle at 444,000.

Although these changes are miniscule in comparison to our peak jobless claims of 674,000 in March of 2009, we still saw recoil from employers who’ve decided to keep their hiring plans on hold. The statistics presented exacerbate the perception of volatility in the job market and self-perpetuate the deficit of job creation. However, it’s no secret that employers have been running lean, and have thus been postponing projects that can no longer wait. So how does a skittish employer mitigate the risk of another trough in the economy but still get the job done? Contingent labor - Contractors who don’t add to the permanent headcount of the company and therefore don’t carry the risk of unemployment claims, layoffs, tax penalties, and other employment law nightmares. We have already begun to see an increase in contract labor, which is a reliable economic indicator that permanent jobs will be created within the next six to eight months or so. And furthermore, becoming a contractor is a great way for an employee to get into a company and prove their worth, which can lead to a permanent job offer.


The moral of the story? Employers have options. They can manage their risk by utilizing a contingent workforce. And for job seekers - don’t limit your job search to strictly permanent positions. You’ll be surprised by how often contractors become permanent employees of the company they work with.


Best wishes to everyone for a successful and profitable new year!

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