Despite the massive layoffs in the tech sector over the past two years and the explosive sophistication of AI, many companies are still struggling to hire enough tech professionals to meet their IT needs.
An informative piece at LinkedIn projects that by 2030, the United States may face a $162 billion annual revenue loss due to the shortage of skilled tech professionals. This shortage is due to several factors, including:
- Rapid innovation in tech, which leaves skills gaps;
- Insufficient numbers of STEM graduates;
- Retiring baby boomers who are leaving talent gaps behind;
- Inefficiencies and limitations to America’s immigration system, including a massive backlog of green cards;
- Stagnant and unwieldy hiring processes that haven’t evolved to meet current realities;
- Insistence on in-office work, which limits candidates to the immediate geographic area of the company; and,
- Shifting priorities of today’s candidates who, post-pandemic, highly value cultural fit, work/life balance, and flexible work arrangements.
One of the best ways for companies to address this shortage is to integrate contract tech professionals into their workplaces.
Benefits of Contract Tech Professionals
It may seem daunting and counter-intuitive to move towards employing contract professionals. After all, they will need to be replaced frequently, causing more work for a company’s hiring team and HR department. As well, employers may be concerned about the loyalty of contractors, wondering if those workers will become truly invested in the success of the company.
But, a workforce composed of contract professionals is flexible, dynamic, and highly skilled, allowing you to easily adapt and pivot as your priorities shift and your company grows. There are many benefits to integrating contract workers into your workplace.
One reason why people enjoy contract work is the ability to focus on projects and tasks that they enjoy and excel at, without the extraneous work that they find difficult or boring. The result of that focus is finely tuned expertise and specialized skills. For this reason, contractors can fill skills and knowledge gaps in your teams.
Improved Flexibility, Scalability, And Agility
Contractors allow you the flexibility you need to pivot and grow, giving you an easy way to scale down and cut costs during slower times, while also being able to ramp up activity or initiate specialized projects as the need arises. This means that you can be more agile as well. With a team that you can adjust on the fly, you will be more easily able to address urgent needs, complete projects quickly, and adapt to market changes.
Reduction Of Costs
While it may initially seem as though contractors will add costs as your HR team continually hires and rehires them for short-term projects, there are actually several cost benefits to hiring contract professionals including:
- Lower overhead costs;
- Reduced training costs;
- Decreased tax obligations and benefits costs;
- Negation of paid time off and incremental salary adjustments; and
- Lower administrative costs, since contract professionals allow for the “employment burden” (unemployment cost, employee benefits, worker’s compensation, and regulated employer taxes) to be passed to other entities, such as the recruitment agency that places these workers.
In fact, as Oli Harrison reports in a piece at LinkedIn, “the use of contractors can result in cost savings of up to 40% compared to hiring full-time employees.”
Increased Diversity and Innovation
It may be easier to meet your company’s DEI objectives by hiring contract professionals. Since many contractors work remotely, it’s easy to tap into the global talent pool, bringing in the skills and perspectives of a truly diverse group of people. And diversity of talent can also mean increased innovation, as your team approaches collaboration in new ways.
Your company’s commitment to hiring contract workers can allow you to access some of the most knowledgeable and skilled workers in your sector. As the result of worldwide shifts during the pandemic, workers highly value workplaces that support a healthy work/life balance, flexible work arrangements, and a company culture that aligns with their values. Contract work allows people to honor those priorities and they will be eager to work for companies who support their values and goals.
Partner With A Specialized Recruitment Firm
When you’re ready to integrate contract tech professionals into your workplace, it’s well worth your while to reach out to an established, trusted recruitment firm that specializes in placing tech talent. Many of these firms have a pool of contractors that they can source from, to find the perfect fit for your project.
In addition to helping you find talent, whether it’s an IT project manager, systems administrator, or helpdesk technician, a specialized recruitment firm can assist with streamlining many of the tasks associated with hiring contractors, including managing payroll and benefits contributions, withholding appropriate payroll and income taxes, and providing HR-related support.
Establish Clear Contractural Expectations
The written agreement – contract – between a company and a contract professional is critical to a successful working relationship between the two. It’s here that expectations and obligations are outlined for both parties, including:
- The duration of the contract, with specific start and end dates as well as a provision to renew or extend the contract;
- Compensation details, including the pay rate and information about bonuses, incentives, and reimbursable expenses;
- Any benefits offered by the employer;
- The responsibilities and expected deliverables of the contractor, addressing how those deliverables will be reviewed and approved by the company;
- Obligations regarding confidentiality and intellectual property rights; and
- Non-compete clauses, if applicable.
A strong, comprehensive written agreement that outlines expectations and deliverables is a critical first step to successfully integrating contract professionals into your workforce.
Offer Effective Onboarding
Just as for employees, effective onboarding is critical for contractors. However, because the needs and workplace expectations of each group differ, onboarding should be tailored differently for each.
Contract professionals work under time constraints and need to get up to speed quickly. Onboarding for this group should be expedited and should focus on:
- Providing the project-specific knowledge needed to become familiar with the project’s requirements, goals, and deliverables;
- Setting up tools and resources, including company systems, project management tools, and communication platforms;
- Assisting them in achieving rapid productivity;
- Integrating them quickly and seamlessly into your company culture and their team(s) to support collaboration; and
- Providing information on security and compliance, to ensure they are aware of your expectations around data security and legal compliance.
An effective onboarding process will help contractors get to work quickly and ultimately improve their job performance and impact their overall success.
Clear and honest communication between everyone in the workplace is essential to productivity, engagement, and success. In order to help contractors quickly establish good working relationships with their team members, encourage open communication and provide guidelines around your communication structure.
Every company has different communication preferences and protocols. Let your contractor know who to reach out to about different issues and which method of communication is best for different objectives. For instance, team members might communicate casually as needed via an online chat platform. However, communications with clients and vendors are likely expected to be more formal in tone and you may prefer that those communications be done via email to ensure a paper trail.
In addition to clarifying your communication structure, it’s important to model open communication in the workplace for all employees. In a terrific, comprehensive piece, Dan Marzullo explains that companies can foster open communication by:
- Being transparent;
- Inviting employee feedback;
- Checking in often and listening actively; and
- Fostering belonging and inclusion.
Communication is critical in virtually every aspect of work. Helping your contractor understand how your company communicates internally and externally will set them up for success.
Foster Collaboration And Team Building
To be honest, fostering collaboration between contractors and employees can be a bit of a minefield. As pointed out in a terrific piece at the Harvard Business Review:
As a team leader, it’s easy to assume that all people working together on a project should be treated and managed similarly. But the reality is that full-time employees (FTEs) and contractors have different motivations, expectations and backgrounds. In our experience, when you simply manage everyone in the same way, those differences can be magnified and cause a range of problems.
Additionally, unless they’ve worked with you before, contractors won’t be familiar with your organizational structure, how interpersonal relationships are managed in your company, or the strategic context of the project they’ve been brought in for.
Given these complexities, it’s understandable why simply introducing a new contractor to your team doesn’t result in instant and successful collaboration. The leaders in your company have some significant team-building work to do, in order to kickstart the collaboration that’s needed. Working with the contractors and full-time employees on your team, your leaders should:
- Share your project goals;
- Engage in regular team-building activities;
- Clearly define your expectations around collaboration and teamwork;
- Provide collaboration tools and applications to make collaborating as easy as possible;
- Provide regular feedback, recognition, and acknowledgment to all team members;
- Ensure that your meetings are inclusive and offer a way for everyone to contribute; and
- Develop and share a process for conflict resolution.
Achieving success for your business requires that you provide support and guidance for everyone who works for you, whether they are contract professionals or employees. While you may need to create a few new mechanisms and tweak existing processes to integrate contract professionals into your workplace, it will be well worth the effort. Doing so will allow you to access a pool of high-skilled and specialized talent that can help you cut costs and, more importantly, significantly contribute to our company’s success.