The Rise of the Invisible Workforce | The Conference Board

Many organizations rely on external contributors, such as temporary workers, gig workers, and independent contractors, to help meet work demands. According to a Brookings Institution report on workforce ecosystems, external workers, often referred to as contingent workers, can make up 30-50% of an organization’s workforce. However, as pointed out in this recent article by The Conference Board, the management of the contingent workforce is often characterized by a “tactical, piecemeal approach, with insufficient focus on risks like hidden labor costs, protecting intellectual property, or financial penalties and higher labor costs if regulators judge external workers are permanent employees.” As such, the paper emphasizes the need for a strategic and integrated approach to the contingent workforce, based on three foundations: 1) strategic governance, 2) integrated workforce planning, and 3) clear guidelines for managers to ensure transparency, consistency, and compliance with regulations. The article provides ideas for each of these foundational components, including strategic governance, where it notes how Cisco has shifted responsibility for contract workers from the procurement team to a newly created cross-functional steering committee to oversee the deployment of external workers. As a bonus, I am resharing this 12-page Harvard Business Review Analytics Services whitepaper, which addresses how HR and Procurement teams can strategically collaborate on a contingent worker strategy.