Why Retaining Contingent Workers Will Be Critical in 2024

By Mike McGuire | January 26, 2024
Multiracial group of business people having a meeting
Expect more companies to rely on contract talent this year as a way of offsetting hiring challenges and skilled labor shortages.

Contingent workers comprised 15% of the U.S. labor force in 2014.

Ten years later, they account for 35%.

Looking ahead, as more employers rely on contingent workers to offset skilled labor shortages and hiring restrictions, it’s predicted that percentage will increase dramatically in 2024.

That means contract talent, like all talent, will be in high demand but low supply.

It also means that contingent workers, especially STEM professionals, will have many options in their pursuit of ideal placements.

Thus, it’s safe to say that gaining an edge in talent will hinge on a company’s ability to retain skilled freelancers, contractors and consultants.

Improving Retention: It Starts Day One

Picture the first day on a new job.

It's exciting. And overwhelming.

Amidst the newness of everything, it takes a sense of something familiar, something welcoming to make a new hire feel at home. Otherwise, their first day can feel like a freefall.

"The first day is a first impression,” says Tabitha Zaragoza, a program leader who oversees contract consultants in Actalent's Laboratory Services group. "It sets the tone for all the days that follow."

That sentiment is especially true for contingent workers who, by nature of finishing one placement and then starting another, experience more first days and first impressions on the job than most.

"If a place feels like home on the first day, there's a good chance a person will stay and thrive in that setting," Zaragoza says.

But if a place doesn't feel welcoming, fallout can happen quickly. According to Forbes Advisor, 30% of new hires leave within 90 days and 38% within the first year.

"If a person feels like they're on their own," Zaragoza says, "the odds are they won't want to stay in that situation for very long."

Regrettable Turnover: The Silent Killer

The direct cost of replacing an employee ranges from one-half to two-thirds of their salary, according to Linkedin and Zippia.

That's assuming a qualified replacement can quickly be found.

Among STEM professionals, the scarcity of talent is glaring, with only 0.3 unemployed workers available to fill open roles.

"Regrettable turnover is a silent killer," says Nathan St. Cyr, a team leader in Actalent's Laboratory Services group. "Companies feel it most in the form of institutional knowledge loss, lost time and replacement costs. Unchecked, those losses and costs can quietly stunt a company's growth over time."

A Structured Onboarding Process: The Key to Better Engagement

Now, contrast turnover costs with the cost and benefits of intensive new hire onboarding.

Companies with a structured onboarding program keep 58% of employees for at least three years, according to Forbes, and have a 33% more productive workforce. What's more, onboarding only costs about $1,400 per employee on average.

“Intensive onboarding and training improve retention starting Day One,” said Wendy Wilcox, a team leader in Actalent's Laboratory Services. “The key is doing a lot of simple but very meaningful things to remove the stress and uncertainty that comes with starting a new role in a new place.”

Actalent's Approach to Onboarding Consultants

For instance, when Actalent provides engineering and sciences services, a team leader like Wilcox or St. Cyr usually meets each Actalent consultant at the front door on their first day. They have breakfast, talk, tour the job site and meet the consultant's new project managers and teammates. After, the team leader takes care of the logistics, like securing the consultant's badge, getting them situated in their workspace, and making sure logins and equipment work.

“During onboarding, we want Actalent consultants to focus solely on learning and getting acclimated with the work and their surroundings,” Wilcox says. “We don't want them feeling frustrated because they got lost, or are having trouble with sign-on credentials, or can't figure out who to call if they have questions or get stuck on something.”

"It's our job to make sure everything goes smoothly for our consultants and our client," adds St. Cyr.

And the numbers show that that level of care is well worth it. According to one study, offering a structured onboarding experience improves retention rates 23%.

Sustaining Consultant Engagement: Keep the Momentum Going

The role of an Actalent team lead doesn't end at onboarding.

“Actalent team leaders can also oversee training and consultant performance reviews,” says Wilcox.

Essentially, the care and guidance a team leader provides Day One is extended to consultants throughout their career with Actalent.

"One of the more impactful things we do is open the channels of communication," says Wilcox. "When we gather and share constructive feedback from the client with our consultants, those moments produce the healthiest and most productive conversations that we have."

The feedback provides clarity to all sides, she says.

"It emboldens our consultants to keep doing a great job," says Wilcox, "or it gives them a springboard off which to improve. Either way it's a win-win and a morale boost for everyone."

Actalent's expert recruiting and retention strategies also help clients avoid or identify talent that isn't an ideal fit.

"We can identify very early, either during the screening process or in the probationary period, when a person isn't right for the role," says St. Cyr. "That prevents a great deal of wasted time and resources for everyone."

Retaining Contingent Workers Requires Bandwidth Managers Don't Typically Have

Handling everything — the onboarding, training, performance and engagement of consultants — with patience, care and transparency requires bandwidth that managers might not have in addition to their core responsibilities.

"Managers are so busy," says St. Cyr. "That's why what Actalent does is such a huge benefit for them. We give them back time, energy and peace of mind knowing that the talent they rely on to get work done is confident and engaged, having been properly trained and aligned to their mission."

Regardless of the industry, whether it's life sciences, consumer and industrial products, aerospace and defense, utilities or transportation, if your organization needs help sourcing, managing and retaining a contingent workforce, contact Actalent today to speak to one of our experts.

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