Tapping the Surge in Useful Contingent Labor Market

In the pre-pandemic world of 2018, Gallup reported that 36% of US workers participated in the gig economy. That number grew headed into 2020, when The Future of Work Exchange reported that 43.5% of the average organization’s total workforce was considered contingent. During the pandemic, many people realized the possibilities of alternative work arrangements, so it’s no surprise that in 2021, that number reached around 47%, with indications it would continue to grow.

Employees aren’t the only ones discovering the benefits of contingent work. Companies see the upside of this work arrangement also. Bringing in highly skilled workers who can zero in on specific projects leaves full-time employees able to focus on their jobs. According to a March 2020 Pharm Exec article, hiring contingent workers in pharma can be especially effective in helping to launch a new drug.

“The pandemic accelerated the trend of companies outsourcing non-core competencies,” says Clint Wallace, head of human resources for Sanofi North America. “The so-called Great Resignation has forced companies to become even leaner than they were pre-pandemic by focusing their full-time labor investment on their core business talent.”

As a result, there has been an increase in demand for contingent labor that spans entire organizations—from unskilled to professional positions. “As a business, we benefit as we can scale our workforce relative to specific project demands and reduce our overhead costs in an unstable economy,” says Wallace.

This model can also help to fill skills gaps within a company. While contingent workers might seem like a short-term solution, they can often turn into longer-term opportunities. “At Sanofi, we have tapped into this resource extensively within our manufacturing and distribution operations, where one of our primary sources of full-time line workers is the contingent workforce,” says Wallace. “The practice of leveraging a temp-to-perm process has proven highly effective as it greatly reduces the risk of a bad hire.”

One challenge some companies may face with a contingent workforce is navigating the legal and regulatory waters, as this landscape often changes and can vary by location. This requires a strong collaborative team of professionals including HR, legal, and procurement. “Maintaining and enforcing a cohesive contingent labor policy is essential,” says Wallace. “This document has to act as a ‘living policy’ that can adapt quickly to legal changes that may occur at a state or federal level.”

Successfully managing a large contingent workforce also requires a strong partner to ensure a company is attracting the critical resources and skill sets needed as well as manage workers once they are engaged. Bristol Myers Squibb (BMS) uses a third-party master service provider (MSP), which acts as a liaison between the company and the more than 100 staffing agencies with whom it partners to fulfill its needs. “These resources are part of our extended workforce and are critical to our company success,” says Megan Ksenzakovic, director of global contingent workforce at BMS. “The MSP monitors the worker life cycle, training, paperwork, and invoicing, as well as ensuring compliance with all of our policies and practices. They act as total talent strategy partners to help us fulfill our strategic staffing needs, as well as ensure the full life cycle of activities are done in an efficient and compliant way. For example, as we merge into the pandemic/endemic world of work, our MSP will help us to identify and reduce co-employment risks as well as address any future state compliance pieces we should be considering relating to the pandemic as well.”

As part of BMS’s central contingent workforce (CW) program, the company also uses a vendor management system. This is a key component to the program, as it offers a centralized platform for all worker data to be housed—providing efficiency as BMS does not have to check multiple internal or external vendor systems.

The CW program also helps consolidate the contingent labor invoicing, allowing BMS a greater level of transparency and visibility into what is spent on its contingent workforce, including market rates, hours worked, overtime usage, and trending over time. “That allows us to contribute to our company total workforce reporting, alignment, and metrics in a strategic way,” says Ksenzakovic.

As pharma organizations look to manage a growing contingent workforce, the key, she adds, is to figure out how much flexibility a company can build into its program. It’s something these workers demand, and the companies that can offer options are poised to stand out.

Elaine Quilici is Pharm Exec’s Editor-in-Chief. She can be reached at equilici@mjhlifesciences.com