A recent report entitled “The State of Contingent Workforce Management 2016-2017: Adapting to a New World of Work” indicates that 63% of companies and organizations are beginning to embrace new methods of developing their workforces. Driven by concerns over budgeting as well as the ever-increasing popularity of the gig economy, these companies are beginning to develop or add to their strategies of engaging an on-demand workforce. These strategies can help companies and organizations to better manage their total cost of ownership (TCO).

What is the gig economy?

Simply speaking, the gig economy forgoes traditional, full-time employment in favor of temporary workers who are hired to complete specific tasks for a company or organization. Some of these tasks are short-term, while others may be long-term. Many of these jobs are done remotely from the location of the company hiring the freelancer. Contract workers who complete work without formal employment arrangements drive the gig economy. These workers can be found across many industries, including the technology and telecommunications industries. In fact, recent reports indicate that by the year 2020, 40% of the workforce in the United States will be made up of freelance workers.

What are the benefits of embracing an on-demand workforce?

There are many benefits to embracing the freelance workforce model. Many companies choose to hire freelancers in order to cut costs. Since contractors are not considered to be employees, companies can spend less of the budget on salaries, overtime and benefits. Businesses can also reduce overhead costs by hiring remote contractors to complete tasks and eliminating the need for more office and workspaces. Freelancers can also be used to boost a company’s full-time workforce.

Which companies are seeing successes with their on-demand workforce?

Two of the foremost names in the gig economy are Uber and Airbnb. Both of these companies, along with Lyft and other similarly conceived business models, have fully embraced the contingent workforce model. Other companies and platforms have also emerged and become successful in embracing the gig economy. Tongal, an on-demand marketplace for video production and other creative endeavors has attracted large companies like Dannon, LEGO and Ford to their innovative freelance marketplace.

The technology and telecommunications industries have also seen success in utilizing the gig economy. Many companies have found that hiring a freelance engineer workforce has been made possible by the leaps that technology has made within the past few years.

What factors are driving the contingent workforce trend?

According to the “Global Human Capital Trends 2016" report, nearly half of the executives surveyed said that they would be upping their use of freelance and contract workers. The reasons cited for these changes were the increase in minimum wage regulations, the regulations regarding overtime pay and the new rules on part-time workers. By utilizing a freelance workforce, companies are able to save on costs by spending their budgets on purchase orders from freelance workers rather than full-time salaries.

Another leading factor in the increase of hiring freelance workers lies in talent availability. Companies in remote locations may find it difficult to attract qualified workers, thus they may choose to hire remote freelance workers who telecommute for the duration of their contracts. In the technology and telecommunication fields, companies have found that a contract engineer workforce allows them to serve customers in remote areas without the added overhead costs of running an office with full-time field engineers on hand.

What kind of platform can help in hiring a freelance engineer workforce?

One of the most daunting aspects of embracing the gig economy lies in finding freelance workers to hire. A solution to hiring and managing a contract engineer workforce are online and on-demand engineer marketplaces. These marketplaces provide companies with the opportunity to search for highly qualified freelance field engineers available for hire. Marketplaces such as Fieldengineer.com provide a full range of project management tools to make the task of hiring and managing contract engineers as simple as possible.