Business today must be flexible than ever before. Globally, organizations are focused on creating an agile workforce comprised of both employee and non-employee workers to deal with increased competition and rapidly changing market conditions.
The usage of contingent labor has risen dramatically in recent years as a result. Contingent workforces are increasingly being used by companies for both strategic reasons, such as supplementing internal talent capabilities, and operational reasons, such as increasing flexibility and responsiveness.
The same study estimates that some large companies spend up to 30% of their procurement budgets on contingent workers.
It makes sense that organizations are turning their payroll expenses from a fixed cost to a variable cost by using contingent workers.
However, paying independent contractors is very different from paying your employees.