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Contingent Workers: Creative Solution or Harmful Crutch?

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Business may seem like an objective arena where rationality rules, but the truth is, agreeing on facts doesn’t always lead to agreement on conclusions. Case in point: the rise of contingent workers.

No one is arguing with the reality that part-timers and contractors  are making up a larger slice of the total employment pie. There’s not even much disagreement that they save companies money in the short-term, but when it comes to the longer-term effects of greater numbers of contingent workers, consensus is harder to find.

Is the rise of the freelancer also a boon for workers who get flexibility and ownership of their careers? Or is the trend just a way for companies to wriggle out of obligations to their workforce and a practice that will erode morale over time?

The Institute for Corporate Productivity (i4cp) recently stirred this debate with a “he-said, she-said” style newsletter, laying out both sides of the argument. Defending contingent workers as a vital and healthy part of the new economy was John Gibbons, i4cp’s VP of research and development:

If you think that high-performing companies use employees simply as disposable commodities, you’d be wrong. High-performing leaders actually keep contingent employees in their jobs longer than low performers. Why? It’s because they don’t use contingent workers as simply a short-term way of saving some cash. Smart managers know that building a workforce composed of a critical mass of contingent workers is not just a short-term fix to financial tight spots or budget cuts. Instead, contingent workers represent a way of building a smart, up-to-date, yet nimble base of vital talent.

And contingency is not just great for businesses — it’s terrific for employees too… Contingent work arrangements allow skilled employees to not only choose who they work for, but also give them the latitude to actually negotiate their specific work assignments, their work settings … and even their bosses.

Oh please, responded Lorrie Lykins, i4cp’s managing editor, who argues that many companies are using contingent workers as a crutch that allows their full-time employee base to atrophy:

You say that contingent workers are not viewed by companies as disposable commodities, but in using temporary workers or contractors to come in and perform certain functions aren’t we making some fulltime employees feel disposable? Some firms I interviewed… admitted that the morale of their employees has been affected by the presence of contractors who are brought in to work on challenging or creative projects while the FTEs keep the engine of the organization chugging along. So while your super-creative contractors may come in and produce something really cool, does it balance the sometimes detrimental impact on your core workforce?

And it’s not just ic4p who is debating the issue. The New York Times (s nyt) also recently ran an article focusing on the human reality behind the trend, concluding, ambivalently, that contractors must weigh uncertainty and lack of benefits against freedom and the security of multiple income streams. Meanwhile, lawyers note the U.S. government’s crackdown on the misclassification of contractors needs to be factored into the equation when assessing the pros and cons of contingent workers as well.

Do you find the optimists’ or the pessimists’ take on contingency workers more convincing?

Image courtesy Flickr user Leonid Mamchenkov, CC 2.0

2 Responses to “Contingent Workers: Creative Solution or Harmful Crutch?”

  1. Anonymously Between Positions

    We’re ALL expendable – contingent and FTE alike. Contract and temporary relationships are always the first to be sacrificed. FTE’s are third in line. We’re all pawns in the game of business, especially the worker bees (funny how management is less often cut in first round layoffs, if at all – they’re too busy getting rid of others to save their own skins). I’m not interested in trading my time for a scrawny ‘at-your-beck-and-call/low-pay’ temporary position of any kind – why should I make life a little easier on your FTE’s when what I want is their job? Employers, it’s going to bite you in the backside once the economy gets back on it’s feet. I want YOU to be as committed to ME as I am to your business, so don’t insult me – hire me as a REAL employee. And they wonder why loyalty to the company is dead in America and morale is so low? My only loyalty is to providing EXCEPTIONAL work and services to your customers. That’s the best this pawn can do anymore – few companies deserve anything else. I’m not bitter, just realistic.

  2. I am an optimists who find value in what these freelancers/remote workers has to offer and if you do your research right – you might have a gem in your hands. I think that freelancers are more productive than your regular employees who might be spending a lot of wasted time in coffee breaks or rumor mongering when they should be working.