HR.com’s State of Contingent Work 2024

Unlock unlimited growth and flexibility for your business

Contingent workers, encompassing those outside traditional full-time employment, offer a valuable talent pool for today’s workforce landscape. They provide flexibility and diverse skill sets in a world grappling with talent shortages, economic instability, and an aging workforce. 

There is a growing interest in contingent workers among businesses that want to meet their evolving needs, seek agility, and want to adapt amidst uncertain times.

Although contingent workers tend to be a relatively small portion of the overall workforce in most organizations, there is a growing section of businesses that lean heavily on them, as per a recent study by HR.com.

‘HR.com’s State of Contingent Work 2024’ study takes a deep dive into how organizations — including both heavy and light users of contingent labor — are managing these critical work relationships. The study also looks into other facets of contingent work, offering insights and actionable strategies for organizations to help harness the full potential of their contingent workforce.

Here are the major findings from the study:

Contingent Composition

Finding: A large majority of organizations say contingent workers make up some portion of their workforce

We asked respondents to indicate what percentage of their overall workforce is made up of contingent workers. Only 16% chose "none," indicating that most companies (84%) today use contingent workers.

Fifty-seven percent say that contingent workers make up anywhere from 1% to 24% of their overall workforce. Additionally, 14% of participants report that the proportion of contingent workers in their organizations falls within the range of 25% to 49%. However, it is worth noting that there are firms that heavily depend on contingent workers. Twelve percent of the surveyed firms revealed that more than half of their workforce is comprised of contingent workers.

Finding: Independent contractors are the most used contingents 

Adaptability is becoming increasingly crucial in today's workforce landscape. Independent contractors emerge as the predominant contingent workers, with 60% of organizations opting to leverage their expertise on a project-by-project basis. This trend reflects a strategic pivot towards a more agile workforce model, where specialized skills can be accessed as needed.

Following closely behind, consultants hold a significant presence, with 51% of organizations integrating them into their workforce. This underscores a useful business strategy, as companies recognize the value of external perspectives and domain-specific knowledge in enhancing their operations and strategic decision-making processes.

Not to be overshadowed, temporary employees from temp agencies make a strong showing at 40%, rounding out the top three.

A smaller portion (12%) use contingent arrangements to bring in fresh perspectives. While unintentional, some organizations may suffer from groupthink. Bringing in a consultant, for example, can help challenge conventional perspectives and bring in fresh ideas.  

Why Are Organizations Using Contingents?

Finding: A majority of organizations leverage contingent workers to staff short-term projects

Two-thirds (66%) of organizations strategically leverage contingent work arrangements to staff short-term projects. Meanwhile, about half (48%) embrace contingent work arrangements to elevate business agility and flexibility. Additionally, a little over two-fifths (43%) are enhancing their skill arsenal precisely where needed, completing the comprehensive canvas of strategic workforce optimization leveraging contingent workers to enhance the skill levels of their workforce, which can become a major challenge amid today's rapidly changing technologies.

Finding: Half of the organizations believe full-time workers are more expensive than contingents

As businesses evaluate their staffing models, the debate between hiring contingent workers and full-time employees reveals some compelling insights. Full-time roles, often viewed as the pricier option due to the comprehensive benefits they demand, are considered more expensive by half of the organizations.

On the other hand, about a third (32%) counters this view, pointing to contingent workers as the costlier choice. This overturns the viewpoint on traditional cost-saving narratives, suggesting that the premium expertise and flexibility of contractors and consultants might come with a heftier price tag.

To learn more, we invite you to download and read the research report today:
   

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