Use of Contract Workers Increasing in On-Demand Economy
Employers may love the loyalty full-time workers offer, but they are increasingly looking to freelancers to complete specific projects in the growing "on-demand economy." Still, full-time employees need not fear too much for their futures, said Rowan Benecke, global chair of Burson-Marsteller. "The on-demand economy and these new modes of working are creating as many new opportunities for employment, for revenue creation and flexibility as they are in disrupting them," said Benecke. "People are going to re-skill and retool for new ways of generating revenue and managing different work streams. According to the Workforce of the Future Survey, 56% of employers said having a full-time employee makes it easier to accommodate the ebbs and flows in work volume, as compared to a contract worker. Meanwhile, the employers surveyed said that contract workers are less loyal or invested. The survey, sponsored and developed by the Aspen Institute's Future of Work Initiative, the Markle Foundation, Burson-Marsteller and TIME, looks at how companies are coping with new employment models such as the growth of contingent and contract work and the On-Demand Economy. Despite having questions about their loyalty, employers surveyed still like using independent contractors both for the flexibility of hiring workers with specific skills as the need arises (90%), as well as for cost-saving purposes such as taxes and benefits (86%). When asked to choose one or the other, 58% of employers say full-time hires are better for their company because they provide more value over the long-term despite having to pay more up-front on taxes and benefits. Meanwhile, 67% of those employers surveyed say their company seeks to limit the number of contingent workers in favor of full-time employees, while 60% report using contingent workers. Of those who use contract labor, 57% expect to use more in the future and 70% of all employers predict that more companies will move toward a more on-demand labor model. Elsewhere, the survey showed that 97% of employers who use independent contractors are satisfied with their performance. And even those employers who say they will use fewer independent contractors report a 95% satisfaction rate with these workers. Additionally, the survey reported that 54% of employers agree that non-employee contingent workers are "not always available when I need them;" and 52% agree that non-employee contingent workers are "not as invested in their product." Finally, 80% of employers who hire independent contractors offer healthcare benefits to full-time, W2-based employees, while only 17% offer those same benefits to independent contractors, according to the survey. And the survey said 80% of all employers offer paid vacation to full-time W2 based employees, while just 13% offer these benefits to independent contractors.