DCR TrendLine shares analyses of trends and happenings in the staffing industry. The July edition covers a range of topics, including the latest employment figures from the Bureau of Labor Statistics and the growing utilization of temporary workers across multiple industries. This month’s edition focuses on the Information Technology (IT) industry, highlight trends in the sector and sharing insight into employment and wages. We examine the skill gap in the industry and discuss how companies are attempting to bridge it. We also highlight how predictive analytics are being applied in human resource management and which talent acquisition metrics companies should be tracking. Our feature article this month is particularly applicable to companies with contingent workforce programs. We look at the challenges companies often face, and offer tips on keeping CW programs running smoothly.
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NOTE FROM THE EDITOR
INSIDE THIS ISSUE
Hello July! Can you believe that it’s already the second half of the year? As we enter the second half of 2014, the staff at DCRTrendLine is hard at work to provide you
with key insights into the temporary staffing industry. Our up-to-date research and analysis of the contingent space ensure that you have a clear reading of what’s
happening in the world of contingent worker supply and demand.
The DCR National Temp Wage focuses on wage trends over the year and analyzes the usage of temporary workers and related developments in the economy and
job market. While the latest job numbers from the Bureau of Labor Statistics have been positive, we examine why some economists are still concerned about the
state of the economy.
Every month we’ve been talking about the growing utilization of temporary workers across multiple industries. This month is no exception with economists
confirming that temporary workers are becoming a significant part of the American workforce. We discuss why some labor activists are worried about this growing
dependence on temp workers as it relates to workforce management and labor policies.
This month DCR TrendLine is focusing on the Information Technology (IT) industry. Our first article on this topic examines the skill gap in the industry and how
companies are attempting to bridge it. The next article focuses on industry-based employment with the DCR TrendLine IT Employment and Wage Index. Look for our
job title focus on software developers.
Everyone’s been talking about big data and predictive analytics and their application in improving business processes. Until recently, human resource management
has been virtually untouched by this field. We look at how predictive analytics is being applied to talent management and offer suggestions on three different
approaches companies can take to get started in talent analytics.
Staying on the topic of human resources and analysis, our next article identifies and discusses six talent acquisition metrics that companies should be looking at to
monitor the effectiveness of their recruiting campaigns.
Our feature article this month is particularly applicable to companies with contingent workforce programs. We look at the challenges companies often face, and
offer tips on keeping their CW program running smoothly and on track.
Our final article this month highlights the application of cloud computing and the growing trend of offering everything as a service. We examine a new buzzword
in the industry – Workforce-as-a-Service (WaaS) – and its potential advantages and usage towards talent acquisition and management.
Ammu Warrier
Ammu Warrier, President
“Even with the continued slow pace of
economic recovery, demand for temporary and
contract workers continues to increase across
most sectors. This is positive for job seekers
looking for employment flexibility or a bridge to
a permanent job.” ~Richard Wahlquist, President
and CEO of the American Staffing Association.
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Note from the Editor...............................................................................................................................................page 1
DCR National Temp Wage Index..........................................................................................................................page 2
Temps No Longer Temporary................................................................................................................................page 6
Bridging the Skills Gap in I.T.................................................................................................................................page 8
Industry Highlight: Information Technology Index.......................................................................................page 11
Predictive Analytics Applied in HR.....................................................................................................................page 14
6 Talent Acquisition Metrics to Tune Into.........................................................................................................page 18
Staying on Track........................................................................................................................................................page 21
Everything-as-a-Service.......................................................................................................................................page 23
Methodology.............................................................................................................................................page 26
References.................................................................................................................................................page 27
About DCR..................................................................................................................................................page 28
3. DCR NATIONAL TEMP WAGE INDEX
“The DCR National Temp Wage Index continues to rise steadily in July 2014. Job numbers released by The Bureau of Labor Statistics (BLS) showed that non-
farm payrolls added 217,000 jobs in May 2014. The unemployment rate stayed unchanged at 6.3 percent.
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Professional and business services added 55,000 jobs, while the healthcare sector gained 34,000 jobs – twice its average monthly gain for the past 12
months. Average hourly earnings increased 5 cents to $24.38, and the PayScale Index expects to see a 0.8 percent growth in wages for the second quarter
of 2014. Over the past 12 months, wages are up 2.1 percent and inflation has risen 1.6 percent.
The number of U.S. temporary help services job increased by 14,300 jobs, totaling almost 2.9 million jobs. The temp penetration rate remained the same
at a high of 2.07 percent.
The U.S. employment services industry had revenues of $68.06 billion in the first quarter of 2014, according to seasonally adjusted estimates from The
Census Bureau. This is a 2.6 percent increase from the fourth quarter of 2013. The employment services category includes employment placement
agencies, temporary employment agencies, and professional employer organizations.
The American Staffing Association (ASA) Employment and Sales Survey found that U.S. staffing companies employed an average of 2.96 million temporary
and contract workers per week in the first quarter of 2014, a growth of 3.2 percent from the prior year.
“The underlying hiring trend…is encouraging, with more good news expected through the summer and into the autumn months.” ~Bart van Ark, Chief
Economist at The Conference Board
4. DCR NATIONAL TEMP WAGE INDEX
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According to a national employment report released by the Society for Human Resources Management (SHRM), hiring in the U.S. manufacturing and
services sector for June is expected to reach a four-year high. The report’s survey found that 61.4 percent of manufacturing companies have plans to hire
in June, while 49.6 percent of service-sector employers plan to add to their workforces.
In April 2014, the number of U.S. job openings increased by 6.9 percent compared to the previous month.The job openings rate, which is a measure of job
openings compared to total employment, rose from 2.9 percent in March to 3.1 percent in April, according to the BLS.
JUNE HIRING TO INCREASE
Year-Over-Year Temp Job Growth, Seasonally Adjusted
Source: BLS
5. DCR NATIONAL TEMP WAGE INDEX
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Though the economy continues to add jobs every month and unemployment remains steady, some economists are concerned that the quality of jobs is
lacking.The number of jobs in typically well-paying fields, such as manufacturing, construction, and government, have shrunk, while lower-wage positions
have grown. The U.S. has 1.6 million fewer manufacturing jobs than when the recession began, but 941,000 more jobs in the accommodation and food
service sector. Over 40% of the jobs added in the past year have been in generally lower-paying fields.
Compared to January 2008, jobs in construction are down by 20 percent, manufacturing by 11.7 percent, and banking by 4.8 percent. Over the same
period, temp jobs are up 16 percent and leisure and hospitality positions have increased by 8.1 percent.
However, Mark Zandi, chief economist at Moody’s Analytics says that the quality of new jobs has improved in the last twelve to eighteen months. In May
2014, the strongest sectors were business and professional services and healthcare.
DESPITE JOB GROWTH, ECONOMISTS ARE CONCERNED
“ ““It is a quality game much more than it is a quantity game. We’re not
really seeing that high-wage recovery that is indicative of a strong
consumer lining their pockets with wages and going out and spending.”
~Lindsey Piegza, Chief Economist at Sterne Agee
“Now we’re seeing increasingly greater numbers of high-paying jobs
being created and some middle-paying jobs. My sense is, going forward,
we’re going to see much better-quality job creation.”~Mark Zandi, Chief
Economist at Moody’s Analytics
6. 5
DCR NATIONAL TEMP WAGE INDEX
DESPITE JOB GROWTH, ECONOMISTS ARE CONCERNED
The U.S. economy has grown at a pace of 2 percent since
recovery began in mid-2009, and many economists project
a growth pace of at least 3 percent in the second quarter of
2014.
The Wall Street Journal
Employment Change in Sectors since Start of Recession
7. TEMPS NO LONGER TEMPORARY
Contract workers account for over 2.3 percent of U.S. employment, according to Bureau of Labor Statistics (BLS) reports. Research from online job site
CareerBuilder.com shows that 42 percent of employers intend to hire temporary or contract workers as part of their 2014 staffing strategy.
Economic data also confirms that temporary workers are becoming a significant part of the American workforce. In March 2014, temporary work made up
more than 2 percent of the workforce, a peak not seen since April 2000.
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TEMPS NO LONGER TEMPORARY
“We argued when the recovery began that there would be a
structural shift. We were hearing from members who were hearing
from their clients, [that] they were more likely to use temp and
contract workers.” ~Steve Berchem, COO of American Staffing
Association
“I think on balance, they are a positive reflection of the extent to
which production has become more flexible, a reflection of hybrid
operations. Some people don’t like it. But that’s neither here nor
there. That’s where everybody’s moving.” ~Jerry Jasinowsky, former
Head of National Association of Manufacturers
“Workers increasingly serve businesses that do not
officially ‘employ’ the worker – a distinction that
hampers organizing, erodes labor standards and
dilutes accountability.” ~Catherine Ruckelshaus,
General Counsel for the National Employment Law
Project
Experts point to the Affordable Care Act (ACA) as a relevant factor in this trend, as employers strive to avoid benefit expenses. However, recent clarifications
to ACA are aimed at closing this loophole. Analysts predict that temp and contract employment will continue to increase as baby boomers retire from
full-time jobs.
Some industries, such as manufacturing, are highly dependent on temporary workers. An estimate from theW.E. Upjohn Institute for Employment Research
states that manufacturing companies employ 40 percent of all contract workers.
Labor activists have concerns over the continued utilization of contract workers, citing risks such as lower paychecks compared to full-time workers and a
lack of unionization. Economists worry that since temp workers are easier to release than full-time workers, companies will be able to avoid responsibility.
Eileen Appelbaum from the Center for Economic Policy and Research says,“In the private sector there’s no counterbalancing power. The decision is almost
costless to them.”
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ECONOMISTS’ CONCERNS
9. BRIDGING THE SKILLS GAP IN I.T.
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For many years, companies have been turning to alternative solutions to permanent hiring to fill information technology (IT) positions in their workforce. A
new survey from Sologig and Harris Poll for CareerBuilder asked hiring managers in the IT industry to explain their recruiting challenges. Many pointed to
gaps in expectations around wages, shifting technology, and above entry-level job requirements as the reasons for the skills gap in the industry.
“At the pace certain programming and development skills evolve, there’s no silver bullet for recruiting tough-to-fill technology
jobs. Employers have to constantly evaluate their talent needs through workforce planning and ensure their compensation is
competitive enough to attract top talent. IT workers, meanwhile, must always be polishing their existing competencies and
acquiring new ones to stay relevant.”~Eric Presley, Chief Technology Officer at CareerBuilder
What’s Causing the Skills Gap?
Source: Sologig and CareerBuilder
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10. 9
BRIDGING THE SKILLS GAP IN I.T.
To bridge the skills gap, IT hiring managers are increasingly engaging contingent workers. TEKsystems, an IT staffing solutions provider, says that
25 to 35 percent of IT leaders expect that contingent labor will make up between 11 and 25 percent of their overall IT workforce by 2018. The same
study found that 69 percent of IT leaders believe that contingent labor is critical to the success of their organization’s business operations. However,
58 percent say that finding contingent workers that meet company needs is difficult.
IT leaders also struggle with aligning their contingent labor strategy with company-wide workforce planning strategy. More than one in ten IT
leaders say their use of contingent labor is not defined, and only 11 percent say that their HR department understands their contingent workforce
needs. Additionally, only nine percent believe that their HR department has the expertise to effectively source contingent worker and 6 percent
believe that HR has domain-expertise to effectively screen candidates.
BRIDGING THE GAP
The IT Skills Gap, The Difference Between Hires and Job Openings
Source: BLS
11. BRIDGING THE SKILLS GAP IN I.T.
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TOP STAFFING CHALLENGES
IT Hiring Managers’Top Staffing Challenges
Source: CareerBuilder and Sologig
A different study by Sologig and CareerBiulder in March 2014 revealed that the top staffing challenges in information technology staffing are related
to the retention and recruitment of high-skill talent.
12. INDUSTRY HIGHLIGHT: INFORMATION TECHNOLOGY INDEX
For the past two decades, employment in Information Technology (IT) has grown rapidly, though declining during the recession and remaining relatively
static since 2011. As per the Bureau of Labor Statistics (BLS), between 2001 and 2012, employment in computer systems design and related services grew
by 18 percent, or by 232,300 jobs. On a year-over-year basis, IT employment has grown by 2.88 percent since May 2013 adding 130,100 IT workers.
According to TechServe Alliance, the national trade association of the IT & Engineering Staffing and Solution industry, the number of IT jobs grew 0.28
percent from April to May 2014, to a total of 4,650,000 jobs. Engineering employment has grown 1.82 percent since May 2013 adding 44,800 engineering
workers.
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DCR TrendLine IT Employment and Wage Index
Source: BLS
13. INDUSTRY HIGHLIGHT: INFORMATION TECHNOLOGY INDEX
“We continue to see a consistent steady climb in IT employment numbers. Growth in May IT employment was virtually identical
to April’s numbers. On the engineering side, we saw some acceleration in growth compared to the past two months. Put simply,
demand for IT and engineering talent will remain robust for the foreseeable future.”~Mark Roberts, CEO of TechServe Alliance
Employment and output in the industry are projected to grow rapidly through 2020, outpacing similar professional industries and the economy as a
whole. Between 2010 and 2020, output in computer system design is expected to grow at an average annual rate of 6.1 percent compared with 2.9
percent for all industries.This growth is attributed to firms and individual consumers continuing to increase their usage of information technology services,
with cloud computing contributing substantially to industry demand. Cybersecurity is another area expected to lead to employment increases.
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Key IT Sectors Employment
Source: BLS
14. The BLS defines the job title of ‘software
developer, systems software’as an IT professional
who researches, designs, develops, and tests
operating systems-level software, compilers,
and network distribution software for medical,
industrial, military, communications, aerospace,
business, scientific, and general computing
applications. As of May 2013, the employment
estimate for this occupation was 373,510 with
a mean annual wage of $104,480. The industry
with the highest level of employment for this
job title is computer systems design and related
services, and the industry that pays the highest
is other information services. The job title is
expected to grow by 22 percent by 2022, a rate
much faster that most professions.
INDUSTRY HIGHLIGHT: INFORMATION TECHNOLOGY INDEX
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I.T. STAFFING
JOB TITLE FOCUS – SOFTWARE DEVELOPER, SYSTEMS SOFTWARE
Annual Mean Wage by State
Source : BLS
Employment and Employment Growth, Projected 2010 to 2020
Source : BLS
Occupation Employment in 2010 (in thousands) Projected growth 2010-2020 Median Annual Wage (2011)
Computer systems analysts 135.3 43.1% $82,160
Computer programmers 116.8 28.8% $72,100
The Operating Practices Report byTechServe Alliance reveals that median IT and engineering staffing firm revenue was up 9.6 percent in 2013 from the prior year.
According to CareerBuilder and Economist Modeling Specialists (EMSI) research, computer support specialists and computer programmers are among the fastest
growing temp positions at a growth rate of 19 percent each.
DifficultyinfindingskilledworkersiscontributingtothegrowingdemandforITcontractors.Morethan60percentofcompaniesusingstaffingsolutionsagreethat
the primary reason for them to approach an employment firm is to find an IT candidate for a vacant position.
Monster.com advises those looking to enter the IT industry to start off with temp positions, especially in the areas of technical support, low-level web skills, and
programming.
Software developers, applications 174.0 57.4% $88,120
Computer support specialists 107.4 43.1% $48,800
Software developers, system 117.8 71.7% $94,570
15. PREDICTIVE ANALYTICS APPLIED IN HR
Gartner expects the market for big data and analytics to generate $3.7 trillion in products and services and create 4.4 million new jobs by 2015. According
to the U.S. Census Bureau, over 75.6 percent of households are online, meaning a large number of adult Americans are posting substantial personal
information on the Internet. With this volume of data available, predictive analytics is emerging as an in-demand trend in human resources.
Businesses have increasingly used predictive analysis for years but it has only recently been applied in the area of human resources. Historically, firms
have studied historical data in order to anticipate opportunity and risk, with industries such as financial, marketing, and healthcare utilizing analytics to
consider factors such as credit scores, sales targets, and healthcare plans.
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Data Analysis Applied to Functional Areas
Source: Accenture
16. PREDICTIVE ANALYTICS APPLIED IN HR
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Companies have volumes of employee, HR, and performance data, ranging from demographic information, performance reviews, educational
history, job locations, and other factors relevant to workers. Talent analytics would allow managers to use this data scientifically to make decisions
about workforces and plan for the future, such as anticipating leadership and talent gaps and developing candidate pipelines
In the growing field of talent analytics, recruiters are using predictive analysis to screen job candidates’ potential to become good employees.
Talent analytics can be utilized to cross-analyze a candidate’s resume with personal information available on social networks such as Facebook,
giving employers a tool to understand a candidate’s interests and personality. Data and analytics give HR professionals the opportunity to take a
forward-focused and data-driven approach to talent management and people development.
According to a Deloitte survey of 436 North American companies, talent analytics is helping build better talent outcomes in regard to leadership
pipelines, talent cost reductions, efficiency gains, and talent mobility.
However, there is some resistance to the application of predictive analytics in human resources. While almost every business operation can be
automated, the personal or ‘human’aspect is difficult to integrate into technology. While it is getting easier to predict someone’s next action, we
are still far away from digitized systems being able to understood and predict human emotion.
A study by Accenture finds that while analytics are becoming important to executive management, they are not considered a replacement for
human resource departments. A survey by the Chartered Institute of Personnel and Development (CIPD) found that HR professionals also are
reluctant to engage with numbers or are passive towards them, and only half of senior HR leaders actually think that they are able to link their data
to key business and financial data.
Companies face challenges applying predictive analysis to human
resources, as data analytics demands skills not commonly found in HR
departments. A March 2014 report from Bersin by Deloitte found that
78 percent of large companies rated HR and talent analytics as ‘urgent’
or ‘important’ enough to place analytics as one of the top three urgent
trends, but 45 percent of the same companies rated themselves as‘not
ready’to pursue predictive analytics.
A different study from Bersin by Deloitte shows staffing for
analysis is a top area of investment, and 31 percent of
organizations surveyed either hired or transferred additional staff
in 2013 to boost their analytics capabilities. Another 22 percent of
organizations hired external consultants to help in their analytics
initiatives.
“Skepticism about whether a data-driven world would
be a better one still abounds. Some HR practitioners
feel that analysts are not sharing enough data or
insight and are operating without a full
understanding of the purpose of analyzing people
data, leading to a ‘bean counting’ approach to the
measurement of people. Meanwhile, some analysts
feel that HR practitioners are not asking the right
questions. This is a healthy tension, but one which
must be resolved if HR professionals are to fully
embrace the talent analytics revolution, which is
already central to business conversations.” ~John
McGurk, Head of CIPD Scotland
People Data Demographics, skills, rewards, engagement
Categoiries of Data Examples
Performance Data Performance ratings, goal attainment, succession programs, talent assessments
Program Data Attendance, adoption, participation in training and development, key projects and assignments
TALENT ANALYTICS
RESISTANCE AND CHALLENGES
Talent Data Available to Companies
Source: Bersin by Deloitte
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17. PREDICTIVE ANALYTICS APPLIED IN HR
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Source: Deloitte
HR Executive’s Assessment of HR’s Analytics Capability Levels
18. PREDICTIVE ANALYTICS APPLIED IN HR
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For companies looking to apply predictive analytics to their human resources function, the transition can be challenging. However, there are some
potential starting points:
1) Add some unexpected roles
Adding some niche positions such as demographers, business intelligence specialists, or mathematicians can help to bring in a different view
while still being hands-on with numerical analysis and generating insights from data.
2) Invest in the equipment
Equip the team with HR technology and training in visualization and project management. Also building a close relationship between HR and IT
helps as often HR organizations working in predictive analysis have an IT specialist on the HR staff.
3) Make analytics user-friendly
Use tools such as dashboards to make analytics easy to understand for business units. Search for technology that incorporates the user
experience and visualization, so that it is approachable to business users.
3 WAYS TO START
19. 6 TALENT ACQUISITION METRICS TO TUNE INTO
With human capital management taking center stage in corporate strategy, measuring the performance of talent acquisition campaigns has become
important. This requires tracking key metrics that can indicate the effectiveness of a recruitment campaign and point out areas where improvement
is required.
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Most Frequently Measured Talent Acquisition Metrics
Source: Staffing.org
20. Time to fill, or time to start, is a common metric in recruitment that measures the average number of calendar days from the date a job requisition is
approved to the date that a new hire begins work.
As per a recent Society for Human Resource Management (SHRM) report, most large organizational typically fill a position in 43 days while smaller
companies take 29 days to fill.
This metric allows recruiters to determine the effectiveness and efficiency of the hiring process and to manage hiring expectations across the company.
Cost per hire is calculated by summing up all recruitment expenses, including advertising, agency, travel, interviewing, relocation expenses, referral
bonuses, and HR departmental costs, and dividing it by the total number of new hires for the calendar year.
According to SHRM, the cost-per-hire for small organizations (less than 1,000 employees) is around $3,079 while larger companies have a cost-per-hire of
$4,285.
Cost per hire allows managers to understand how much they are currently spending on hiring individuals and if there are improvements that can be made
to the hiring process, such as bringing in an agency or recruitment process outsourcer (RPO) to more effectively manage costs.
Many companies measure the quality of their hires by tracking turnover and looking at performance appraisal ratings. Since this metric can vary by
organization and industry, it’s difficult to report on. However, once an internal benchmark is set, HR professionals can begin to assess quality of hire. ERE, a
recruiting community, suggests defining quality of hire as how well a new hire meets the performance needs of the position.
Managers find it valuable to discover the sources of applicants, as this shows which recruiting channels are the most effective in attracting candidates
to the organization. It also reveals how various sources compare in terms of quality, quantity, speed, and effectiveness. To find the percentage rate for a
specific source, divide the number of source hires by the number of external hires.
Candidate satisfaction data is driven by the percentage of new hires that are satisfied with the hiring process. Candidate satisfaction surveys help
organizations determine if the recruiting process has a positive impact on the employment branding of the company.
Pipeline development refers to the number of potential candidates that a recruiter has developed relationships with for key strategic positions. Often this
data is managed through an effective candidate relationship management system. Similar to tracking pipeline development of sales personnel, measuring
recruiter candidate pipelines can improve time to fill, cost per hire, and quality of hire.
1) TIME TO FILL
2) COST PER HIRE
3) QUALITY OF HIRE
4) SOURCE ORIGIN
5) CANDIDATE SATISFACTION
6) PIPELINE DEVELOPMENT
6 TALENT ACQUISITION METRICS TO TUNE INTO
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22. STAYING ON TRACK
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Companies with blended workforces often face challenges in managing different types of workers. Research from Aberdeen Group suggests that almost
25 percent of the total workforce can be considered contingent or temporary, and this will only continue to grow. As non-employee workers become a
significant part of total workforces, contingent workforce management becomes an important part of companies’operational goals.
While using contingent workers offers many benefits such as cost savings, increased efficiency, administrative savings, broader talent pools, and flexibility,
keeping a contingent workforce programs on track is tricky. This is especially true when a company uses multiple staffing providers to fulfill a range of job
roles. Analysts estimate that the percentage of‘troubled’projects staffed through temp workers that fall short of time, budget or quality goals ranges from
40 to 60 percent.
Increasingly, companies are turning to Managed Service Providers (MSPs) to manage the multiple staffing vendors and keep their contingent workforce
programs running smoothly. According to industry analysts, almost 70 percent of the country’s largest employers are using a MSP to manage their
contingent workforces. The MSP serves as a neutral party that offers a workforce solution while ensuring efficient operation and leveraging multiple
staffing companies to obtain competitive rates. MSPs often use a Vendor Management System (VMS) as a software tool to provide transparency and
efficiency in the management of the contingent workforce. Companies often cite having a single point of contact as the biggest advantage of using a MSP.
23. STAYING ON TRACK
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TIPS TO KEEP YOUR CONTINGENT WORKFORCE PROGRAM ON TRACK
To get started on keeping their contingent workforce program on track, managers should put thought and emphasis on certain tasks, even if using a MSP.
1) Define the objectives of the contingent workforce management program clearly
Defining and prioritizing key goals will help to align the program and develop metrics to ensure that these objectives are being met. To encompass
concerns from all areas of the organization, involve hiring managers as active participants in the design of the program.
2) Establish a budget
Having an established budget lets you plan and manage the workforce program with more clarity and transparency. A defined budget also provides
a framework for evaluating workforce management options.
3) Minimize resistance from the beginning
As with the adoption of any new process, resistance is expected from stakeholders who will be impacted by changes. From the very beginning,
attempt to minimize this resistance by having clear communication about all aspects of the program and explaining the benefits of active program
participation.
4) Develop a communications plan
Whether using an external MSP or managing contingent workers internally, clear and effective communication is a primary factor in promoting
an environment of transparency and trust. If you’re using an external MSP, it also helps all parties to clearly communicate your priorities and
expectations.
5) Create a change management process
Implementing a contingent workforce program is sure to bring about change, and having a process to deal with bumps along the way will make
the transition easier for all stakeholders. Establishing a clear governance structure with defined roles, schedules, issue resolution processes, and
approvals is also helpful in avoiding navigating hurdles.
6) Beside‘must have’goals, also formulate a wish list
The best program managers go beyond the essentials to deliver benefits that might be on your hiring managers’ wish lists, such as increasing
program participation, acting as an advisor, educating hiring managers, and coaching suppliers.
Workforce Management Objective MSP Users Non-MSP Users
Cost savings 9% 7%
Time-to-fill an open requisition 9.8 days 12.2 days
Compliance to internal and federal policies regarding contract labor 64% 46%
Onboarding timeframe 2.9 days 5.7 days
Contingent Workforce Management Performance, MSP vs. Non-MSP
Source: Aberdeen Group
24. There is no denying that cloud computing changed the way IT serves the enterprise. For some years now, software, databases, customer relationship
management, and other key elements of information technology have been pushed into the cloud to be deployed“as-a-Service”. For example, the models
of Software-as-a-Service (SaaS), Data-as-a-Service (DaaS), and Infrastructure-as-a-Service (IaaS) have become an everyday part of corporate vocabulary.
A research study by TheInfoPro found that the global cloud computing market would grow at a 36 percent compound annual growth rate (CAGR) through
2016. Gartner estimates that global end-user spending on public cloud services will be more than $180 billion by 2015. And Forrester forecasts that the
global market for cloud computing will grow to more than $241 billion in 2020. According to McKinsey & Company projections, the total economic impact
of cloud technology could be $1.7 trillion to $6.2 trillion annually in 2025.
Public Cloud Services Market Growth, 2010 to 2015
Source: Gartner
EVERYTHING-AS-A-SERVICE
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25. 24
As the idea of sharing and scaling services that were once local and isolated continues to gain popularity, we’re starting to see almost every function being
delivered as-a-Service to businesses, even outside of enterprise technology. For example, one could say that companies like Airbnb are housing clouds that
deliver Housing-as-a-Service, or Zipcar and Uber are car clouds offering customers Transportation-as-a-Service. Even 15 percent of U.S. healthcare systems
leverage cloud computing for storage of images, with this number expected to increase to more than 50 percent over the next three years.
Industry experts are now looking at a future where any functional service can be“clouded”.
Everything-as-a-Service (XaaS), also known as Anything-as-a-Service, is a collective term that stands for a number of things that could be offered via cloud.
In the staffing industry, a term and concept that is gaining momentum is “Workforce-as-a-Service” (WaaS), where online platforms like eLance enable
employment to be light on human assets and have minimal fixed costs. WaaS basically provides companies with the flexibility of an on-demand workforce,
where they can engage the right talent when it’s needed. Onforce, a cloud-based platform for technical talent, says that companies can save 20 to 60
percent on labor costs by tapping into WaaS.
Workforce-as-a-Service offers companies several advantages, including:
“If you look at the HR market, this is a very big market that’s grown
very quickly. This is at least an $8 billion market. HR [software as a
service] is one of the biggest spaces in SaaS today…Our view is that
it’s a very big market that’s going through a very big refresh cycle and
there is a lot more opportunity for growth.” ~Mike Zappart, Principal
at Adams Street Partners
“Today’s employment model takes into account only
the primary talent of an individual and ignores the
reality that humans are generally multidimensional
and useful outside the scope of their stateful roles.
This means valuable human capacity is wasted. If
human capacity were aggregated as liquid, stateless
supplies, it would allow companies to spin up
capacity to meet the demand of projects.” ~
Richie Etwaru, Group Vice President of Cegedim
Relationships Management
- Immediacy of labor
- Faster speed of work
- Lower costs
“Business leaders interested in the future of IT should stop thinking of‘the cloud’as a noun and start thinking about‘clouding’
as a verb…Clouding is not new, and compute, storage and network are not the only things that can be clouded.” ~Richie
Etwaru, Group Vice President of Cegedim Relationship Management
EVERYTHING-AS-A-SERVICE
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“WORKFORCE-AS-A-SERVICE
26. 25
According to Richie Etwaru, Group Vice President of Cegedim Relationship Management, under the umbrella of “Everything-as-a-Service” (XaaS),
companies can explore clouding the resource of human capacity. For example, expertise could be delivered as a service. This creates the opportunity to
leverage what Etwaru describes as“humans-as-a-service”(HuaaS), the model to whichWaaS is a predecessor. HuaaS could be a disruptor in how companies
source and utilize their most valuable assets - human capacity.
Changing the current employment model by aggregating human capacity into a pool of supply, as companies such as TaskRabbit and eLance do,
would allow companies to ramp up and divest of human capacity to meet demand as needed. This is similar to the way compute and storage clouds are
currently used.
Essentially the evolution Etwaru is discussing is on-demand talent in the cloud, with the ability for any company to source individual talent or groups of
talent for anything at any time. On some levels, this evolution is already taking place with the sourcing of temporary workers globally via
freelance and crowdsourcing sites. The next step in the evolution would be to scale this flexible model effectively and efficiently for enterprises and also
smaller companies.
While the model is appealing in theory, there are some caveats to consider. When using WaaS or HuaaS for complex projects or long-term engagements,
there are some issues that companies need to consider. These concerns include worker screening, worker classification, and worker management.
EVERYTHING-AS-A-SERVICE
HUMANS-AS-A-SERVICE
27. METHODOLOGY
The DCR NationalTempWage Index is developed to assess the relative movements of temporary wage rates in the U.S. economy.The wage
rates for temporary workers or contingent workforce are based on payments made by staffing firms to these workers based upon hours
worked. Data collected from sources such as Bureau of Labor Standards (BLS) and other government sites as well as an internal pool of
staffing companies and consultants, is aggregated and classified based on regions and skill categories, to arrive at an aggregate index.
The baseline for the index is set at 100 for January 2007. Index value for a particular month indicates relative wages with the said baseline
and is representative in terms of direction and scale of change. Five years of data has been included to observe seasonal patterns and
distinguish seasonality from long-term wage movements. The data and the model has been further refined over last six months.
DCR TrendLine combines the exhaustive data from BLS with practical and more recent developments and data from on-field consultants
and clients, to provide timely near-term indications of trends and consistent long-term actionable and objective information.
DCR TrendLine uses multiple economic variables to ensure the robustness of its forecasts and cross-validation of trends.
Key data sources and parameters of interest included and influencing the index are:
Unemployment data
Gross Domestic Product
Prime rate of interest
New and seasonal Job openings
Non Form employment
Job Opening
All Export
All Import
Average Hourly Earnings of All Employees Total Private
Aggregate consultant data on job market parameters
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SOURCE DATA