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The Growth of the Contingent Workforce

The Growth of the Contingent Workforce. Introduction. The Emergent family of companies, founded in 1976, is one of the largest U.S. employers of contingent labor, issuing over 475K W-2s to the workers it employed in 2011. Corporate Office | Burbank, CA. Jeff Chao Business Development

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The Growth of the Contingent Workforce

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  1. The Growth of the Contingent Workforce

  2. Introduction The Emergent family of companies, founded in 1976, is one of the largest U.S. employers of contingent labor, issuing over 475K W-2s to the workers it employed in 2011 Corporate Office | Burbank, CA Jeff Chao Business Development • 10 years of staffing & employment experience, including: • Nationwide Employer-of-Record Firm • Professional Employer Organizations • Vendor Management Systems • Staffing Companies

  3. Overview As the U.S. begins to show the first real signs of recovering from The Great Recession, the contingent workforce in America continues to grow and is quickly cementing itself as a critical and long-lasting component within the U.S. labor force.This presentation explores: Contingent Workforce History Marketplace Direction & Drivers Workforce Segments Contingent Workers Today Contingent Workforce Demographic Best way to implement your contingent workforce strategy Summary

  4. History

  5. Marketplace DirectionTotal Annual Spend & Average Daily # of Workers Source: Staffing Industry Analysts and Bureau of Labor Statistics

  6. Marketplace Drivers The Economy The downturn in the economy hastened the arrival of an increased & growing usage of a flexible workforce, driven primarily through: • Employers realizing that their companies need to remain nimble with only a core group of mission critical employees. • Employers also appreciate that the labor landscape is also changing (i.e. remote workers). • Industry specific or seasonally skilled workers can be easily engaged by multiple employers. Workplace Mindset • The historically homogenous US workforce has quickly become very diverse, encompassing three to four distinct generations working side-by-side. A 40 year career at the same company is not as appealing as it once was.

  7. Workforce Segments Hourly Fixed-Bid

  8. Contingent Workers Today • Baby Boomers (1946 – 1964) • Unlike previous generations, not retiring as expected: • Choice • Necessity • In most cases, studies have shown • Less motivated by pay, power and prestige • More flexible work schedules, more engaged • Generation X (1965 – 1979) • Dual personalities: • Coined “work / life balance” as time is often regarded as their most valuable commodity • Are corporate rising stars; realize that project-based success has replaced function-based work • Generation Y (1980 – 2000) • On average, change jobs 8x in first 20 years: • Specialized employment is replaced by flexible & diversified deployments • Loyalty to company is now commitment to self Sources: 1. AARP, Family & Work Institute 2. Sloan Center on Aging & Work at Boston College

  9. Age Differences are Compelling • For Contingent Workers… • Career Stage Workforces Make Sense • For Employers… • Experience & Perceptions Matter • Each generation has varying goals & work ethics and they can work in unison benefiting themselves and their employers at the same time • Baby Boomers: late stage or re-careers typically center seek to work at their own pace, helping others, passing on their experience – preventing “brain drain” (Snowbird Programs) • Generation X: perceives performance focused deployments and continual learning as the breeding ground for continued choice and ability for advancement • Generation Y: often value relevant, wide bases of experiences in the workplace – creating a solid foundation for the budding careers

  10. Sourcing Methods

  11. Supplier Qualification Staffing Supplier qualification is important as client companies may be considered a co-employers of contingent workers with the Supplier. • Ensure financial stability of the Supplier • Ensure Supplier has adequate legal, insurance, risk management and human resources capabilities & expertise • If not using a client agreement, make sure the Supplier has well articulated agreements outlining employment-related laws including • Occupational Safety & Health Act (OSHA) • Family & Medical Leave Act (FMLA) • Fair Labor Standards Act (FLSA) • Immigration Regulations • Other laws, especially those on the state & local level • Make sure Supplier has proper and adequate insurance • Make sure the Supplier has documented human resources and safety policies (ideally outlined in an employee handbook)

  12. Supplier Agreement Supplier Agreements are a critical way to ensure proper Supplier compliance and limit liability. Important points include: Consider moving away from timecard only Agreements Clearly outline responsibilities and limitations of each Party Identify proper insurance limits in Agreement(s) Ensure proper and adequate indemnification is in place Complete a new Statement of Work for each new assignment, continuation or change in work Consider consolidating contingent workforce employment under one company for ease of use and cost containment

  13. Contingent Worker Handbook

  14. Summary • The U.S. contingent workforce is growing for many reasons including: • Corporate flexibility • Cost savings • Worker preference • As this workforce grows there are significant opportunities for your company to limit cost and risk including: • Leveraging worker “Self-Sourcing” methods • Implementing Supplier qualification best practices • Structuring detailed agreements outlining responsibilities and roles of Supplier and your company

  15. Thank You! • Jeff Chao • jchao@emergent.com • Toll-Free:855.250.5000 • Office: 818.955.4320 • Mobile: 310.613.8049 • Fax: 818.450.0915 • 2835 N. Naomi St. | Burbank, CA 91504 • @emergentdotcom

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