The staffing industry and the contingent workforce is in the midst of “intense change” as trends such as remote work, the talent crisis and digital transformation continue to disrupt the norm.
That’s according to Staffing Industry Analysts’ President Barry Asin, who covered these trends in his opening keynote address at the firm’s Executive Forum North America event in Miami Beach, Florida.
In this article, we take a closer look at the key takeaways from his speech.
The Talent Shortage is Becoming the “Talent Crisis”
The workforce in the US has returned to pre-pandemic levels, but there is a lag in labor demand growth.
Currently, there are 6.3 million more jobs than workers. However, the talent crisis is already turning into a bigger problem. According to Asin, this is a combination of the "Great Resignation" and the "Great Retirement."
The labor force participation rate for adults older than 65 was 19.3 percent in January 2023, down from 20.7 percent in January 2020.
Large clients of staffing services have already responded to this talent crisis by increasing pay rates (71 percent), allowing more contingent workers to work remotely (59 percent), and changing vendors (57 percent). For example, warehouse workers saw their hourly pay rise to $18.01 this year, up 15.7 percent from 2020.
There is also an increased emphasis on candidate diversity. SIA research found that 59 percent of companies have a candidate diversity program in place today, and 36 percent plan to do so in the next two years.
Technology
Artificial intelligence (AI) is becoming increasingly prevalent in the staffing industry. Asin noted that we may be nearing the peak of the "hype cycle" for ChatGPT, the point before users gradually realize the actual productivity benefits of the product. Already, 43 percent of front-office vendors have some AI capability in their products.
Vendor management systems are also changing dramatically. You can learn more about that in our latest guide, The Top 5 Trends in VMS Technology 2023.
Contingent Workforce Growth
Contingent work spend is on the rise, with spend on contingent work increasing 28 percent since 2019, to $1.7 trillion in 2021. Independent contractors/self-employed workers receive the lion's share of the spend at 57 percent, while temporary staffing represents 10 percent of spend.
Remote Work
Remote work is here to stay, and it's not just staffing professionals who are demanding it. LinkedIn data found that 50 percent of job applications are submitted for remote positions while only 15 percent of job listings are for remote work.
SIA research found that temporary workers are highly in favor of remote work. 61 percent of them rate remote work as highly valuable, and 20 percent are currently working remotely.
As we move through 2023 and the coming years, the contingent workforce is only expected to grow. Asin said that businesses are still planning to use more contingent workers, from 21 percent of their workforce today up to 28 percent in 10 years.
Those who manage their contingent workforce efficiently will be the ones who receive the best return on investment. Want to learn how to do just that with an easy-to-use, modern vendor management system? Book a demo of Conexis VMS today.