Contract Staffing is a process of recruiting required human resource on contractual basis. This contract takes place between one company and an individual. The third party (esp. the recruiting firm) provides staff to the company for a specific period of time at a specific rate – usually an hourly rate. Since the contract is for a specific period of time, it can also be renewed and the contract will continue under similar terms for another period of time.
The fact is that not all companies are looking to hire full-time employees. Now, more and more people are considering contract or consulting working style. It is mostly known that companies do contract hiring depending on the projects. Contract employees are individually chosen and hence are more professional. Professional Services (PS) in human contracting is fairly a new concept in India, but this market is fast maturing and catching up the trends in India.
There are many benefits associated with contract staffing which are as follows:
1. Earn More Money: Many believe that thereisn’t much money in contracting however this is not the case. For instance, if you have 5 contractors working, and you’re earning on an hourly basis for each one, so that would be calculated as number of hours multiplied with number of contractors. Over the course, those contractors would earn hours*number of contractors*number of weeks in a year. Plus, that is not including the overtime.
2. Meet clients’ expectations: Contract staffing allows you to satisfy all you clients’ needs acting you as a “sole-provider”.
3. Enjoy flexibility: Allows you to acquire the proficiency needed for the timeframe and save money & manpower resources. This also makes wise economic sense to employ individuals with specialized skills.
4. Access to skilled workers: Contract workers generally have broader work experience thus they can provide fresh ideas with innovative solutions.
5. Managing uncertainty: during uncertain times like fluctuating economies, businesses prefer hiring contract staffs.
According to Gadgets Now dated an article in June, 2014, IBM is biggest investor in IT contract staffing. IBM spends over $150 million annually to recruit contract IT staff. Similarly, Accenture, Microsoft, Cisco spends over $80 million each on maintaining a vast pool of contract workforce.
Today, contract workers vary predictably by organization size, where large organizations make more use of contract workers than smaller organizations. Recession has caused many organizations for using the contract labour. From last few years, IT companies have started looking out for mid-level and senior consultant positions also apart from entry level.
As we move ahead to future, companies are getting more quality-oriented than work-output-focused which is more commonly found in contract-staffing.