The growing trend for companies turning to temporary labor to fill organizational demand can be attributed to the diminished supply of talent into the workforce, according to new research from Towers Watson. The company also warns of an impending labor shortage set to plague the U.S. and the developed world sometime over the next decade. As labor becomes scarcer, Towers says that employers will see a shift of high-skilled workers from permanent to temporary positions.
“Initially, people thought this was just a phenomenon of the recession and uncertainty at that particular point,” said Ravin Jesuthasan, global head of talent management at Towers Watson. “With the labor shortage, talent is hard to find, and then what happens is as employees become hot commodities, we’re going to see a return to the movement in the ‘90s with the free agent employee.”
Jesuthasan goes on to say that even though the reliance on temporary workers is expected to grow significantly over the coming years, this shift will actually give employers more flexibility in regards to managing employment relationships and accessing needed talent. Even though the most highly skilled talent may not be available on a full-time basis, those workers will be available for project-based work that best suits their interests and skill sets.
“If I’m a financial services company that’s building a new platform, the likelihood of me hiring full-time talent who might otherwise go to a Google, Yahoo or Microsoft is very small,” Jesuthasan says. “But with contractors, I could access world-class talent like that – not for a life time – but for six to nine months to finish a particular project.”