Should you really depend on a temporary workforce?

You may cure your worrywart business partner’s concerns about the unreliability of temporary workers, by saying those are the only hands you can really depend on; but the question is, can accountability, more importantly loyalty be expected out of them?

Harvard Business Review recently reported that the number of temporary workforce, or ‘temps’ has now reached a staggering 28 million in the US. The trend is as evident in Canada and in the UK. In the US over 58% of organizations are willing to employee ‘temps’ at all levels; firms like Macy’s, Walmart, Nike, General Motors, PepsiCo are doing it already.

The rise of the permanent ‘temps’

‘Whip your thoroughbreds’– the expression was famous amongst the high-performing Managers in GE’s hierarchies during Jack Welch’s times. Though a relatively small number, these managers were the ones’ who really drove the productivity. It’s much like the Pareto Principal where roughly 80% of the valuable outcome is generated by 20% of the workforce.

The emphasis was laid on motivating your best managers than pushing the average ones’ harder. Soon companies’ started rethinking the economic relationship with their rest 80% workforce; especially in retail, finance, health care, publishing, real estate and education sectors. This restructuring gave way to more and more temporary and part time employment,

A cost-effective arrangement beyond doubt, but is it really in such Black and White?

There might be Disadvantages too

Though for now industries are quite upbeat about having temps, a year before the 2008 recession, speculations were rife that having temporary workers may lead to long term problems.

While there are advantages to it, certain core values found in regular employees might be a little misplaced in these temporary workers-

a.    Questionable Loyalty and Motivation- Temps generally spend shorter times in company premises, compared to employees on payroll. It means lesser engagement with company goals and achievements, which in turn means a reduced connection with the organization, only limited to earning daily wages.

Also, employee rights being a gray area, along with lack of incentives, bonuses, promotions and at times no health benefits, adds to their detachment.

Of course from their standpoint, this sort of  uncommitted behavior is understandable. But how far can organizations really benefit from such indifferent workforce?

b.    Training goes in vain- You try hard to train temps, which is certainly more in your interest but the resources and the time that goes into it is borne by your company. It can cost you more than what you’ve profited from having them. The non accountability, and no guarantee of returning to work can be a big concern, especially if you start depending on them.

c.    Inconsistency- Temp workers are made aware of their next assignment by their agencies. They give them instructions, tell them about their job’s time and place. This can result in inconsistencies in what temps are informed and the real nature of the job.

To fix this many companies avail the services of employee scheduling software providers for streamlining and disseminating instructions to their workforce.

Also, a temp may come to the job with a negative, unproductive  attitude . It might get worse if the employee refuses to do the assignment.

d.   Incompatibility between regular and temp employees- Your regular, more dedicated employees may find it tough to deal with a difficult temporary worker. It can lead to clashes if the temp shows unwillingness to get trained, throwing a spanner in the works. Besides, your regular employees are more accountable and have bigger duties to perform, handling such workers would compromise their time.

e.   Cost isn’t that small- It’s true your temporary workforce may prove to be more economical than your full time employees. But there are some inescapable costs involved here too, like the fee charged by your Temp agency. Also, agencies often charge you a small percentage of the hourly price your organization pays to the temp workforce. You might also have to run background checks on them which will consume your time and resources. So, enter into a well-calculated deal with your agency.

Wrapping Up

A recent survey by Reuters revealed that in the US, Walmart was hiring only temporary workers in 27 of its stores spread across its 52 states. According to Walmart’s officials, it was being done not as a cost-cutting measure but to ensure they are properly staffed  during busy hours.

For employers, this contingent workforce is also a safer alternative; as in case of a slowdown getting rid of temps will not be such a hassle as laying off regular employees will be.

A CareerBuilder survey of January 2012 shows that more than 1/3rd of the firms in the US are working with a smaller staff than it was before the 2008 recession. And to keep themselves going, an estimated 36% of these organizations will keep on hiring temps.

No matter how it turns out in practice, at least the statistics say that temporary workers are indeed the bee’s knee for companies.

So, go ahead, hire them by all means!

About the Author

As VP of Marketing, Bimal Parmar manages the global marketing strategy and execution at Celayix. With over 20 years industry experience, Bimal is responsible for making sure the world learns about the benefits of Celayix’s solutions that include: advanced employee scheduling, time and attendance, employee communication as well as integration modules for payroll and billing.

Before joining Celayix, Bimal was Vice President of Marketing at Faronics, a leading provider of IT solutions for the Education vertical where he helped grow revenue over 50% and launched exciting new solutions. Prior to that Bimal held senior marketing and product roles at technology companies such as Business Objects and McAfee Security where he gained significant international experience working with global companies such as Microsoft, Dell, Sony, HP, Orange, Telefonica and Ricoh.

You can visit his LinkedIn profile http://www.linkedin.com/in/bimalparmar

educate@celayix.com