Content with Contingent

content-with-contingent_blog_staff-management-SMXThe contingent workforce is making a comeback. Granted, it is a comeback that nobody believed would be necessary over a decade ago. According to Staffing Industry Analysts (SIA), the projected ten-year growth rate was over 50 percent in 2002, yet the reality was closer to a third of that with an actual growth rate of 18 percent for that period. Staffing hit a peak of $132 billion in 2007, however the industry reached a low of $91.8 billion in 2009. On the bright side, it seems as though the dark cloud has finally passed and the Bureau of Labor Statistics (BLS) projects that the staffing industry will exceed $132 billion in the near future.

The American Staffing Association (ASA) reported that the upward trend in temporary help services continued this past month with an addition of 22,000 temporary help services jobs. The year-over-year increase in temporary jobs grew by 8.6 percent. In the month of November, the temporary penetration rate reached a peak of 2.03 percent that was last recorded in 2000, prior to hitting a low of 1.34 percent in May 2009. Currently at 2.02 percent, the figure has suppliers and buyers looking forward to a prosperous future and a faster economic recovery throughout the world.

According to, the use of contingent labor is on the rise industry-wide, thus contingent labor solutions, including managed service provider and vendor on premise programs are gaining interest. BLS data predicts that between 2008 and 2018, staffing companies will add jobs at nearly double the rate of estimated job growth overall. Industry professionals are noticing the increased interest in contingent workforce solutions, particularly industry leaders that are participating in conferences and summits. Staff Management |SMX can certainly speak to this as we experienced firsthand the largest turn out to-date at the Staffing Industry Analysts’ Contingent Workforce Summit (CWS) in September. It can be argued the staffing sphere is becoming more attractive because of its ability to quickly adapt its programs to economic, political and technological changes.

Staffing is an industry that understands the necessity of continuous improvement and rapid evolution. Society for Human Resources Management (SHRM) mentions that the contingent labor category is expanding beyond just temporary workers to include part-time employees, contract workers and independent consultants, staffing agency employees, interns and seasonal workers. The opportunity for flexible scheduling makes workers more likely to seek work through a staffing provider and the ability to evaluate a candidate before engaging in a long-term relationship can greatly reduce costs for employers. In SIA’s 2012 Contingent Buyer’s Survey, buyer’s reported saving a median 13% of their expense budget as a result of using contingent labor. Contingent workforce programs also certify that new hires understand what is expected and ensure that companies reap what they SOW.

SIA defines a statement of work (SOW) as a document that serves as an attachment to a contract between two organizations and acts as a guideline for what should be included in a project and contextualizes expectations. It essentially holds workers accountable for delivering on the objectives the client identified within a timeframe specified by the client. An SOW differs from a traditional contingent worker relationship in which an hourly pay rate and bill rate is applied. Taking into account the scope of a project, an SOW can be a more efficient method to achieve a project-based deliverable. SOW use for contingent labor has saturated the IT space and is gaining interest across all other corporate functions. A well administrated SOW boasts the benefits of cost containment and risk protection for the customer. An SOW can also ensure appropriate worker classification, proper onboarding and off-boarding and adherence to the contractual language in the SOW. SIA’s VMS/MSP Competitive Landscape report indicates a rise in SOW spend, going through MSP and VMS, thus several companies are bringing SOW spend under their contingent workforce programs and the trend, along with prosperity of the staffing industry show no signs of slowing down.