HRO Today Flash Reports are a series of ongoing research initiatives that address today’s topics of interest in the HR community.
HRO Today Flash Reports are focused briefs that can be used to support business decisions and further discussion among industry practitioners and thought leaders. The markets served are North America, EMEA, and APAC.
This report examines the importance of employer branding and workforce engagement efforts for contingent workers. It also looks at the methods used to measure the effectiveness of contingent worker engagement offers.
This study was sponsored by AgileOne.
Methodology
On September 9, 2018, an email invitation was sent to subscribers of HRO Today Global Magazine and HRO Today newsletters to take part in an online study on behalf of HRO Today. Study respondents were manager level or above within their Human Resource departments. Respondents were from the North America region. The study closed on October 11, 2018. Because of the size and diversity of the region and small sample size, these results should be viewed as directional. Respondents were screened to ensure that they use contingent workers on an ongoing basis in their organizations. The average number of contingent workers being used per survey respondent was 2,340, ranging from less than 500 to more than 10,000. Respondents were not aware of AgileOne’s sponsorship of this study.
Conclusions
Nearly three-quarters (71%) of study participants felt contingent workers were an important part of their employment mix. The importance placed on contingent workers isn’t surprising given there are approximately 6 million workers classified as contingent in the US. But despite the degree of importance placed on contingent workers, the percentage of study respondents feeling their employer brand is important in attracting contingent workers is 60 percent, significantly below the importance attached to attracting and retaining full-time employees.
Using the employer brand to attract contingent workers is a completely lost opportunity for up to 40 percent of companies. Just over two-thirds of those surveyed measure the effectiveness of their contingent worker engagement efforts, meaning one-third of those who use contingent workers make no attempt to measure the effectiveness of their engagement efforts. Further, one-half of those not measuring worker engagement effectiveness reported that contingent workers are important to them, suggesting more metrics around how well their engagement efforts are performing would also be important to them. The method most often used to measure the effectiveness of contingent engagement is monitoring social proof sites, indicted by over two-thirds (67%) of respondents. Only about one third (37 percent) take advantage of contingent worker satisfaction surveys to measure the effectiveness of engagement efforts.
One of the reasons organizations use contingent labor is to evaluate a prospective employee prior to bringing them into the organization as a member of their full-time workforce. This is validated by the fact that over one-half (56 percent) considered contingent workers an important or very important source of talent for their full-time workforce, further illustrating the importance of sharing your employer brand with contingent workers.
Importance of Contingent Workers
How important are contingent workers to your overall employment mix?
Study participants were asked how important contingent workers are to their overall employment mix. Nearly three-quarters (71 percent) of study participants felt contingent workers were either important (47 percent) or very important (24 percent). The importance placed on contingent workers isn’t surprising given the number being used in the US. According to the US Department of Labor’s recently released report Contingent and Alternative Employment Arrangements Survey, the number of U.S. workers classified as “contingent” (including those in the gig economy) increased from 5.7 million in 2005 to 5.9 million to 2017; a modest increase but one that still shows the size of the contingent segment in the US.¹
Importance of Employer Brand
Please indicate the importance of your employer brand for each of the uses below.
Respondents were asked to indicate the importance of their employer brand in three areas. Attracting full-time employees was indicated as important by nearly nine in ten (88 percent) of respondents, with most of them (72 percent) indicating it was very important. Retention of current employees was nearly as important, with 84 percent of respondents indicating it was important, and over one-half (57 percent) indicating it was very important to their employer brand. Given that the employer brand concept has gained tremendous attention among HR and talent organizations over the past decade, the idea that employer brands are a vital part of attracting full-time employees and keeping current ones isn’t shocking.
But how does that sentiment contrast with its applicability to contingent workers? “As the source of how work gets done continues to shift globally, companies would be wise to carefully consider their branding strategy when it comes to contingent workers and professional service organizations, says Stacie Habegger, Chief Sales Officer, “There is a shortage of qualified talent available in the market, regardless of classification and companies should position themselves as among the most attractive employment destinations.” This sentiment was supported by our survey respondents, with 60 percent reporting that their employer brand is important in attracting contingent workers; and while that number is well over one-half, it is still significantly below the importance that is attached to attracting and retaining full-time employees.
In fact, the percentage who indicated that their employer brand is very important (72 percent) in attracting full-time employees was nearly five times more than the importance given to attracting contingent workers (16 percent). Clearly, using the employer brand to attract contingent workers is a lost opportunity for up to 40 percent of companies.
Measuring the Effectiveness of Contingent Worker Engagement Efforts
Do you measure the effectiveness of your contingent worker engagement efforts?
Study participants were asked if they measure the effectiveness of their contingent worker engagement efforts. Just over two-thirds (67 percent) had a plan in place to measure contingent worker engagement, but among the 33 percent that currently are not measuring, 50 percent say contingent workers are important or very important to them.
Studies have shown that with full-time employees, highly-engaged employees are 1.3 times more likely to be high performers than less-engaged employees. They are also five times less likely to voluntarily leave the company.² So it makes sense that understanding the effectiveness of contingent worker engagement efforts would likely dramatically increase productivity for this group as well.
Methods Used to Measure the Effectiveness of Contingent Worker Engagement Efforts
What methods do you use to measure the effectiveness of your contingent worker engagement efforts? Please select all that apply.
Base: Companies that Measure the effectiveness of contingent worker engagement efforts
Those respondents that measure the effectiveness of contingent worker engagement efforts were
asked to select the methods they use when measuring effectiveness. The most often used method to measure effectiveness of contingent engagement efforts is by monitoring social proof sites, indicted by over two-thirds (67%) of respondents. Over one-half (53 percent) calculate engagement using the same hiring metrics used for full-time employees. Testimonials, reviews, and ratings are among the most important types of social proofs users look at when making a determination about a place to work, either full-time or on a contingent basis.
Interestingly, only about one-third (37 percent) reported taking advantage of contingent worker satisfaction surveys to measure the effectiveness of engagement efforts. Surveys typically cover areas like job satisfaction, opportunity to perform well at challenging work; and recognition and positive feedback for one’s contributions.
Importance of Contingent Workers as Source of Talent for Full-Time Workforce
How important are contingent workers as a source of talent for your full-time workforce?
Study participants were asked how important contingent workers are as a source of talent for their full-time workforce. Just over one-half (56 percent) considered them an important or very important source.
Other research supports how important contingent workers can be as a source for a full-time workforce. According to the 2016 Workforce Solutions Buyers Survey, the median temp-to-perm conversion ratio among large contingent workforce buyers (1,000-plus internal full-time equivalents) was 10 percent for North American companies, 8 percent for Asia Pacific companies, and 5 percent for European companies.³
For employers, a contingent arrangement provides a way to get to know potential new employees. This way, employers already know some of the individual’s capabilities and personal attributes before extending them an employment offer. Conversely, contingent assignments allow job seekers to experience what it means to work in different firms and office cultures so there will be fewer chances of surprise once full-time employment begins.
Reasons For and Against Leveraging Employment Brands for Contingent Workers
Finally, tell us why you are—or are not—leveraging your employment brand for your contingent workers.
Through an open-ended question, study respondents were offered a chance to explain why they do or do not leverage their employment brand for contingent workers.
Reasons for leveraging the employment brand:
There were many different rationales about the topic of employment brand related to contingent workers, but three themes emerged: adapting to the changing structure of the workforce, a belief that the exact definition of a workforce isn’t as important as the work being done, and the anticipation that contingent workers may become full-time employees.
“We are at a crossroads - we never have used our brand for our contingent workers but it is apparent that the workers and the communities they work in feel they work for the company and not subcontractors, requiring us to dramatically rethink our strategy with contingent workers.”
“To support current workforce strategies, and to be prepared for the Workforce of the Future, we are investing in our brand proposition for all categories of contingent workers to ensure our firm is seen as an attractive destination for assignments and furthering their personal development goals.”
“The experience and value proposition for anyone touching our brand should be the same, be they a FTE, P/T, or contingent worker, let alone Customer and Supplier.”
“We leverage our brand with both contingent and non-contingent workers. Your brand speaks volumes to your workforce, no matter what type.”
“We try and leverage our brand since sometimes contingent workers convert to regular full-time and we wish to attract top quality contingent workers, and therefore wish to leverage our brand under the ‘assumption’ they could convert.”
These sentiments are mirrored by the real-life experiences of an AgileOne client, a large non-profit based in Seattle, Washington. At the outset, the client worked with AgileOne to establish their contingent workforce as a source of full-time workers, as well as an important part of their overall workforce strategy that had not been previously considered. From their first interaction to sharing the job opportunity, the program works hard to cultivate the contingent worker throughout the assignment’s lifecycle and building the non-profit’s employment brand into the engagement. These efforts have had a direct impact on the client’s ability to hire high-quality talent, with more than 60 percent of their contingent staff converting to full-time employees.
“Thank you for all the work you have done to help me build an almost entirely new PA team. The candidates that AgileOne got for us were hands down the best candidates they have ever had for the PA role, not in the overqualified way, but in the direct comparable experience way!”
—Senior Program Assistant
Reasons for not leveraging the employment brand:
There were myriad reasons for not applying an employment brand to contingent workers, though no clear themes emerged. Among those rationale presented, a few themes emerged including the idea that their company was not using enough contingent workers to be concerned about leveraging their employment brand, that it’s not the responsibility of HR to apply the employment brand to contingent workers, that any branding used to attract contingent workers falls to the contingent employee agencies or the company’s own procurement division to manage, or that the nature of the type of continent work being done precludes the use of an employer brand. Some examples of the responses include:
“We do not utilize contingent workers on a regular basis. We have very few contingent workers at any given time. Agencies handle that need for us in most cases and their brand is more important than ours in attracting those workers. The other avenue that we use for contingent workers is through our extensive university relationships. Students do not seem to care as much about brand as they do experience, pay and location.“
“The benefits package and other benefits are different so we choose to attract differently as well.”
“Our contract employees do not stay long enough to consider the value proposition of our employment brand.”
“Hiring of CWs is owned by our Procurement Division.”
While the results of this survey help to shine a light on the role a company’s employment brand plays in the engagement of contingent workers, it is clear that this is a decision that varies from company to company based on their own unique needs. For companies looking to make the shift, it is important to engage the right tools and partners to pave the way. “We are spending a large percentage of our time and resources focusing on the most advanced technology and solution strategies that will bring about the greatest results for our customers, said Stacie Habegger, AgileOne Chief Sales Officer, “Now more than ever, qualified candidates have choices about where they work, and what makes a company attractive goes far beyond salary and benefits in this competitive market.”
Want to know more? Contact info@agile1.com to find out how AgileOne can help you take your employment brand to the next level.
Sources
1. “Contingent and Alternative Employment Arrangements Summary”, Bureau of Labor Statistics, June 7, 2018. https://www.bls.gov/news.release/conemp.nr0.htm
2. Vance, Robert. “Employee Engagement and Commitment,” Society for Human Resource Management, 2006. shrm.org/hr-today/
trends-and-forecasting/special-reports-and-expert-views/Documents/Employee-Engagement-Commitment.pdf
3. “2016 Workforce Solutions Buyers Survey,” Staffing Industry Analysts, 2016 cwstrategies.staffingindustry.com/temp-to-perm-conversion-
ratio/