5 Trends in Workforce Procurement and how to adapt for strategic success

Workforce Procurement is undergoing a period of rapid change, as more companies rethink their human capital strategies to better meet the needs of the agile workforce.

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According to the EY Contingent Workforce Study, more than 30 million US workers will be in contingent roles by 2020 -- equivalent to around 20% of the US working population. If part-time workers are included in the projections, the figure increases to 40-50%.

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This trend, coupled with the desire of businesses to be more agile in response to changing market conditions, sets the stage for unprecedented change in the way organisations think about work.

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As the battle for talent gets tougher, procurement professionals need to ensure they know how to ‘strategically source’ highly skilled workers for complex business challenges.

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Below are 5 key human capital procurement trends for 2019:

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Talent shortage:

With rapid technological change and shifting work patterns, matching the right talent to the right job in a timely manner is easier said than done. As a result, companies are looking offshore because there aren’t enough Australian workers with the right skill set. And for those who do have the skills, the competition for talent is fierce.

Digitisation:

Digital transformation continues to be a catalyst for big changes in staff hiring practices. The most in-demand sectors for freelance workers in 2018 were IT and telecommunications, followed by financial services and retail. This trend is expected to remain in place this year.

Worker attitudes:

The notable shift among today’s workforce is more people want to explore freelance job opportunities. Research in 2018 from Morgan Stanley investment bank showed that within 10 years, freelance workers could represent more than 50% of the US working population. In Australia, the vast majority of professionals freelancers say they prefer it to traditional jobs because of the flexibility it offers.

The Internet of Things (IoT):

Companies and workers will also have to navigate a broader technological shift blurring the lines between physical and digital work-systems. Among the core facets of this change are the application of IoT devices, artificial intelligence, and the implementation of virtual reality which will impact workflow systems and training.

Legislation:

Immigration laws have had an acute impact on procurement in Australia. Large domestic companies have routinely argued for changes to free up the flow of human capital, as our local talent pool just isn’t deep enough. The tech sector, in particular, has been vocal about relaxing the standards on visas for skilled workers to address the skills shortage.

HOW PROCUREMENT NEEDS TO ADAPT

This rapid pace of change means effective procurement practices have taken on increased strategic importance.

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A recent industry survey of Australian freelancers in white-collar industries highlighted the benefits of performing freelance work; flexibility, diversity of work and increased earning potential.

Below are some tips on how organisations can best to utilise a contingent workforce:

Technology:

Improvements in procurement software are having a tangible effect on hiring strategies. For example, Talent Marketplaces and Freelance Management Systems (FMSs) have allowed businesses to access and manage talent, on-demand. These systems are also connecting with Vendor Management Systems (VMS) to complement existing processes and workflows.

Mobile:

Almost any workforce solution will need to employ the effective use of mobile devices. Research shows most workers view that smartphone as an important device in looking for jobs. However, many organisations don’t have a dedicated mobile strategy, such as an app, as part of their efforts to attract and retain staff.

Artificial Intelligence and Virtual Reality:

These technologies are likely to be administered over a slightly longer time frame. In the future, hiring managers could use virtual reality to give prospective freelance workers a visual representation of the company culture and the job, thus allowing both parties to get a better idea if the job and place will be a right fit.

Safety nets:

A recent industry survey of the contingent workforce showed the biggest factor which put people off freelance work was the lack of a safety net that comes with traditional full-time jobs. I.e. job security and insurance. This presents an opportunity for procurement professionals to attract top talent by offering insurance, access to super schemes and gig friendly home loans.

CONCLUSION

By 2020, 40% of the modern workforce is expected to be working in freelance jobs. Therefore, successful hiring managers will need to stay on top of their procurement strategies and the technology trends influencing both the kind of jobs available and how the right staff can be sourced for the right roles.