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It used to be that a contract position was the one you took until a full-time job came along. In short, it was a last resort. Not anymore. More and more workers WANT to be in contract staffing positions. Contracting is no longer a last resort but a conscious choice.

There are currently 17.7 million “independent workers (contractors, temps, freelancers, business owners, etc.) in the United States, according to the 2013 MBO Partners State of Independence in America research report.   Of those, 77% are committed to remaining independent, marking a major shift in the American workforce where direct or “permanent” employment has traditionally be the main goal. Let’s take a look at the factors driving this trend.

Flexibility

The main reason companies turn to contractors is to gain workforce flexibility. It appears that flexibility is also the major reason more workers want to be contractors. In fact, 73% of the MBO Partners study participants said that flexibility was more important than making the most money. This shouldn’t be all that surprising. “Work-life balance” has been one of the most prevalent workplace buzz phrases of the past several years. More households have two working parents who share childcare duties equally and desire more family time. Many of those working parents are also part of the “sandwich generation” who are caring for elderly parents, as well. In these situations, flexibility isn’t just a perk, it’s a necessity.

Contracting can help workers gain that flexibility by allowing them to do the following:

  1. Work convenient hours. Because contract assignments are often project-based, companies usually allow flexible daily or weekly work schedules, as long as the work gets done on a timely basis.
  2. Not be tied to an office. Many companies don’t care if a contractor is in the office from 9-5. If a candidate has the tools they need at home, they can often work between their home and office. This is becoming more feasible thanks to smartphones and the Internet.
  3. Take control of their vacations. When a candidate is hired direct, they may get one week of vacation, two tops, at least while they are new. Even if they are willing to take the time unpaid, they often are not allowed. With contracting, if they want to take an extended vacation, they simply don’t take an assignment during that time.

Satisfaction, Challenge, and Motivation

For many workers, simply earning a paycheck is not enough. They also need to be satisfied with the work they are doing. Like flexibility, doing something meaningful often trumps making a lot of money. This is especially true of those in the Millennial generation. Contracting is a great alternative for workers who yearn to be challenged and make a difference. Companies often use contractors to meet critical deadlines or complete projects, so they are usually able to see the impact of their work much more quickly than they would in a traditional direct-hire position. Because contract assignments are for specific periods of time, workers get to move on to challenging new projects before they get bored. Contracting is a great solution for workers stuck in jobs where they see little opportunity for advancement.

Financial Security 

No matter how important flexibility and job satisfaction may be to candidates, making money is still the main reason most people work. But traditional, full-time employment is no longer a guaranteed path to financial security. The days of spending your entire career with one company and retiring with a fat pension are long past, and any remaining illusion of job security was shattered with the rash of layoffs during the recession. By accepting contract assignments, workers know from the get-go that their assignments will end and usually know approximately when, which is preferable to being blindsided by a sudden layoff. Rather than trusting their livelihood single employer, they turn to recruiters who have a vested interest in keeping them actively working in contract assignments. Often, a recruiter will have their next assignment lined up so there is no gap in between assignments. Instead of counting on an employer to guarantee a comfortable retirement, they contribute to their own savings and 401(k) accounts. It’s important to note that contractors have access to benefits like healthcare, dental, vision, and life insurance and 401(k) plans if they are W-2 employees of a contract staffing back-office.

Contractors also can potentially make more money than they could in a traditional direct-hire job. They are paid for every hour worked and can earn overtime for any hours worked over 40 during a work week.

Workers Have Options
Becoming an 1099 independent contractor (IC) is also an option for workers, but it comes with added costs and risks. ICs don’t get unemployment, and they don’t get Workers’ Compensation unless they set up their own plans. They also do not have access to group health insurance plans or other benefits, which is increasingly important in light of the Affordable Care Act that now requires most Americans to carry healthcare insurance.

These issues prevent many workers from taking on more satisfying independent work, but it doesn’t have to be that way. Contract staffing offers a unique opportunity for them to enjoy the flexibility and other advantages of  independent work without sacrificing the perks of traditional direct employment, including a full benefits package and the protection of Workers’ Comp and unemployment.

Recruiters: Are You On Board?
If you have not offered contract staffing because you didn’t think you could find candidates willing to work on contract, you now know that’s not a problem. So what is stopping you? Tell clients that you offer contract staffing. Tell candidates about contract staffing opportunities, and add them to your recruiting software database if they’re interested. Advertise contract staffing on your website. You will be placing contractors before you know it!

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