The world of business and commerce has gone through massive changes in recent years, largely driven by digital transformation and emerging technology.

There has also been economic, social and geopolitical upheaval on a grand scale. Asian countries are fast gaining ground as world forces, just as the West faces a series of unexpected hurdles, including Brexit and disaffection with recent US protectionism.

There’s also an undercurrent of change running through the way organisations employ staff too – primarily resulting from this formative period of economic history.

In a nutshell, there is an increased reliance on temporary staff. In fact, in the UK alone, the use of temporary staff has risen by a massive 40% in the last decade.

(source: https://www.resolutionfoundation.org)

Many pundits believe this is a trend likely to increase, particularly in the UK when leaving the EU creates new barriers to employing overseas recruits.

However, this is far from a knee-jerk trend. Putting greater emphasis on temporary contracts brings with it far-reaching economic benefits.

Managing labour costs better

Undoubtedly one of the driving factors in this growing use of temporary employees is the cost savings that it entails.

Throughout industry, commerce and the public sector, the emphasis is on reducing waste and creating leaner and more agile organisations. Wage bills are often a substantial proportion of outgoings. Any organisation that fails to audit labour costs and introduce greater control and accountability does so at its peril.

Using temporary staff enables organisations to create more flexible and fluctuating workforces, which in turn means controlling the wage bill far more precisely.

It eliminates waste, especially paying staff when they have troughs in their workload. On the other side of the coin, it enables organisations to bring in extra staff to cover holidays or production peaks. In an era when many companies operate on a competitive knife edge, having too few people on the production line at busy times can be as damaging as having too many when work dries up.

This makes temporary teams economically sound; using staff as and when required, to keep pace with fluctuating order books or seasonal variations.

There is also the potential to source temporary staff willing to accept a lower hourly rate than their full-time counterparts. One survey found that a third of UK managers opt for temporary staff as they are a cheaper source of labour.

(source: https://www.independent.co.uk/news/business/news/uk-economy-latest-agency-workers-employment-workforce-labour-resolution-foundation-research-a8202686.html)

Diverse workforces and a rich talent pool

Using temporary workers is not simply a matter of cold hard cash though. It can create a vital skills boost too.

The UK – as with other countries – is struggling to fill many key roles. Particularly ones related to STEM (science, technology, engineering and mathematics) fields.

Agency staff and temporary recruits can be a valuable source of help in papering over these gaps. Potentially diffusing the way these skill shortages undermine business development.

In fact, utilising temporary contracts, in general, creates opportunities for a more diverse talent pool. You can bring in additional skills to drive particular projects forward or to tackle issues and threats as they arise.

This includes getting external help for such vital business functions as payroll systems, digital marketing or cybersecurity. Not all organisations can afford full-time staff to tackle these issues. But not acting can leave them struggling with compliance and commercial competitiveness. For those situations, short-term contracts offer a manageable “fix” without cutting corners.

It could also be argued that using temporary staff enables employers to create a truly inclusive workforce. They can appoint temporary staff on the basis of their creative abilities and niche skills, irrespective of any pre-formulated and rigorously applied recruitment formula. So, for example, someone unable to join the permanent team due to physical or mental health issues can still find meaningful employment within a specially created temporary contract.

Temporary teams and automation

Increasing reliance on short-term staff also enables organisations to mould their workforces while keeping pace with rapidly advancing technology. Particularly the possibilities of automating business processes.

Big Data enables companies to do things faster, leaner and more profitably. It’s a launch pad to hand mundane and repetitive tasks over to new machines and software. On top of this, AI is passing quickly from science fiction to everyday reality in increasing numbers of businesses.

This vastly improved connectivity, integration and automation are not replacing entire workforces with robots. However, it is changing the functions and purposes that human staff provide. Temporary staff are the perfect foil for technology, enabling companies to put together varied and responsive teams, that create perfect synergy with digital workplaces.

Tackles unemployment and builds flexibility

There are also clear benefits in terms of developing and supporting the UK and global labour market too.

Increased use of temporary staff can alleviate statistics for long-term unemployment. It can also give college leavers their first foothold on the career ladder. A short-term contract builds work experience and skills, enabling them to move to permanent placements if they want to.

It also means parents and anyone else with other obligations can enjoy more flexible work patterns. This too has a knock on effect in improving availability and quality of the labour pool for employers.

Using temporary staff all adds up to an economic global landscape that better supports change and development, allowing companies to evolve and grow stronger.

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