Economic Trends Drive Needs For Full-Time and Contingent Labor Talent Solutions, Which Ones?

Historically the economic trends have had a direct impact on the recruiting and staffing industry.  As hiring began to pick up staffing firms were called upon by various organizational stakeholders to place contractors or engage in a direct hire search. Today there are more choices that  HR / Procurement and  Talent Acquisition Departments can make to better acquire and manage the acquisition of all labor categories.  However, the ability to look at this holistically is fraught with challenges as a result of  last years 28,030 reported company layoff’s (Source: bls.org), consolidations, mergers and acquisitions. These activities put an organization at risk for fragmentation around the acquisition of talent, therefore increasing an organization’s  risk, costs and decrease the overall visibility into the talent supporting an company’s initiatives.

As an organization looks to solutions around the management of talent acquisition, compliance, process efficiency and costs must be center stage.  While this may slow down the decision making process to deploy a set of sustainable solutions, it is important to pay attention to operational areas under scrutiny today:

Compliance: 1099’s / Independent Contractors are under scrutiny by the IRS.  Lexology (www.lexology.com) a legal database online provides insights on the activities taking place right now within big corporations.

Rate Compliance and Management: Any talent that is contingent or direct hire through agencies or search firms, the spend is closely being monitored and assessed.

E-verify / I9 Verifications: Are your employee’s eligible to work in the United States?  Did you know government contractors are required to have all employee’s E-verified upon any new contract win?

OFCCP / Affirmative Action: Law offices of Bond, Schoenick and King report: As reported by BNA’s Daily Labor Report, in 2010, the agency also intends to change its focus by increasing its affirmative action compliance efforts and more closely scrutinizing Federal contractors’ affirmative action plans. Construction industry employers are among those who are likely to be targeted in the coming year.

Cost: Whether it is full-time, interns or contingent labor there is a cost to acquire talent. The cost increases when a recruiting department is not fully staffed, and business units have critical deadlines to deliver work product and generate revenue. It is what we call the people supply chain. To best manage this requires strong solutions, KPI’s, SLA’s and contract management.

Safety and Theft: The effective on-boarding and off-boarding of consultants, contingent labor and full-time labor within an organization. Simply stated, turning off physical and systems access to a worker once they leave the organization.

Impacts on the Recruiting Process

With the increase in layoff’s and 8 – 10% unemployment, the recruiting process is also severely impacted.  Due to the increased number of talent available on the market, the number of applicants to a requisition increase.  The impact of this environment on recruiting is:

  1. More resumes to screen with an average of 2 minutes per resume.
  2. Recruiter / HR workload is unmanageable, therefore potentially impacting quality and the candidate experience.
  3. More resumes to disposition, to meet OFCCP requirements.
  4. More resumes to sift through to determine if outbound or direct sourcing strategies are needed to find the talent required.
  5. Fear of uncertainty whether a permanent hire is a good solution, providing temp to perm as a viable employment solution.
  6. Colliding of contingent labor and direct hire process management to meet short and long term needs.
  7. Audits, law suits and record keeping may take the focus away from direct recruiting.
  8. Documentation and storage of new hire paperwork, start and end dates and security access.

What is the right solution?

The right solution will vary within each organization.  First, figure out your talent acquisition strategy for both the short and long term.  What internal resources exist?  Who owns each of these labor categories below? What does historical data and metrics show? How does this align to the future business direction?

Short term you may need to make some quick decisions that focus on bringing in talent immediately. Long term we encourage you to do a thorough analysis of your workforce, the demographics, trends associated with the direction of the business.

Over the next few blog posts I will provide education and clarity around the options listed below. . Additionally I will be calling on industry experts in each area to provide examples and greater insight. However for the sake of this article let me share the laundry list of choices that exist:

Outsourcing Options:

Contract recruiters, RPO, MSP, Project Recruiting, Onsite Programs, Search Firms and Sourcing Firms.

Operations and Technology:

ATS, VMS, Process Consultants, Audit Consultants, Memberships, Subscriptions, Vendor Management, Systems Administration, Training, On-boarding Tools, Expat Management Services, Survey Tools and ERP programs.

Screening:

Background check vendors, reference check vendors, E-verify, Drug Testing, Assessments and Skills Testing.

Contingent Labor / Consultants:

Agencies, Consulting Firms, MSP, VMS, 1099 Vendor Management, Insurance Compliance Auditors, Payroll Providers.

Recruitment Marketing:

Ad Agencies, Job Boards, Social Media, Tools, Brand Management, Collateral and Career Site Management.

You might be saying we do not need all of this!!! The reality is, at one point in time many of these solutions may be in action within your organization depending upon the volume, size and scope of your organization.  While the intent is not to overwhelm, it is to bring to light the options and the amount of vendor enabled services required to bring talent into the organization.  Depending upon the choices and direction of your organization, this will trigger the types of services that are required, need to be managed and deployed within your organization.

Do a quick audit of what programs and services you have in place today and follow my blog to learn more about each component and how they fit into a greater strategy.

Tomorrow’s post will focus on outsourcing options, providing definition and best practices with each choice.

Tracey Friend, Advisor, Brightfield Strategies
Tfriend@brightfieldstrategies.com

Tracey Friend brings over 15 years of Global Recruiting Operations experience in RPO,HRO,  Internet Recruiting, MSP, Research, Technology and Training.  As part of Brightfield, she provides management consulting focused on designing, selecting and deploying the right recruitment strategy and solution.
Brightfield Strategies focuses on improving corporate financial and operational performance , providing compliance management services and sourcing the best solutions for both contingent and direct hire workforces. Our services include:

Process & Technology: As-Is state assessment, To-Be state design, Requirements doc
Sourcing Services: Spend analysis, Business case development, RFP lifecycle support
Legal & Compliance: Contract & SLA development and negotiation, Worker Classification support, Co-employment advice and training, Supplier assessments and audits

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