Employers need to prepare for shift toward freelance workforce

One of the big trends you should consider in the new year is the change in how people want to work.

The talented people you're seeking may not want to be part of a static, full-time staff but prefer to be on more fluid, on-demand teams.

Consultant Lisa Hufford notes that we are approaching the point where 40 to 50 per cent of the working population won't be in full-time jobs and so firms that continue handling their work through a traditional staffing model will miss out on talent who prefer to be independent.

She has lived this trend herself: A decade ago, after 14 years working in big corporations, including Microsoft, she decided she wanted a different lifestyle that allowed her more control over her schedule to be with her young children and so set herself up in business.

"My story is not uncommon – it's the story of many men and women," she says. Many millennials view security not as working for a single employer but in having the control and freedom to concoct their own working arrangements. And many of the people who joined the freelance economy in desperation as corporations downsized are deciding not to return to traditional work forces when new opportunities arise.

"It's a major talent shift for big corporations to get things done," she says.

We now have to think of who are the best people to accomplish tasks and how best to mingle them. We will increasingly see project teams with some regular staff working alongside free agents assembled for this particular challenge.

In her book, Navigating the Talent Shift, she describes the type of free agents in the workforce:

• Independent contractors (36 per cent of the independent work force in the United States): These are traditional freelancers who don’t have an employer and take on freelance, temporary or supplemental assignments on a project-by-project basis.
• Moonlighters (25 per cent): Individuals with a primary, traditional job with an employer but who also moonlight doing freelance work. An example is a corporate-employed web developer who does projects for non-profits on nights.
• Diversified workers (26 per cent): These people have multiple sources of income from a mix of traditional and freelance work. Somebody might work 20 hours a week at the front desk of a dentist’s office but also drive for Uber or write on a freelance basis.
• Temporary workers (9 per cent): They have a single employer, client, job or contract where their employment status is temporary. An example would be a data entry clerk who is placed by a staffing agency for three months in a company.
• Freelance business owners (5 per cent): They have one or more employees and consider themselves both a freelancer and a business owner.

She finds companies considering a broader approach often mess up by rushing to put together a project team without considering carefully the success they seek.

What are the most important elements of the work that needs to be done? Don't just think of the final results but also your expectations for 30, 60 and 90 days so you understand the project rhythm and texture. "If you can identify that, you can then determine the skills you need for the role and find them," she says.

From there, you must craft a project description specifying what the freelancer will do – the nitty-gritty of the assignment. Base your description on performance – the outcomes you expect – rather than the tasks the individual might undertake. "You need to focus very specifically on what is expected to get done within a time frame," she advises.

As you reach out to contenders, emphasize your company's values since that might be a determining factor. "A millennial can do accounting or IT anywhere. Often they decide by the company's values," she says. And you should want people passionate about your industry. You also want to clarify for them how much work is expected to be done on site and when, something companies often fail to delineate, creating friction down the road.

Interviewing will be far more specific than when bringing on regular staff. Focus on what you need and how they did this work in the past. Check cultural fit: Do they work best, for example, in startups or in large, bureaucratic organizations?

Develop a statement of work with each person you bring on, describing the work to be done, the time line, and the invoicing schedule. Will the freelancer bill half up front, or monthly, as work is completed, or just at the end? Again, misperceptions here can reverberate later.

"You need to think about talent in a holistic way in the new year. It's not just FTEs. It's any professional who can help your company succeed," she concludes.

Harvey Schachter is a Kingston, Ont.-based writer specializing in management issues. He writes Monday Morning Manager and management book reviews for the print edition of Report on Business and an online column, Power Points. E-mail Harvey Schachter