Magazine article Workforce

Maximize the Return on Temp Staff Investments

Magazine article Workforce

Maximize the Return on Temp Staff Investments

Article excerpt

Human resources professionals are currently facing the tightest labor market in 25 years. As a result, many are turning to alternative solutions such as contingent staffing to meet their short- and long-term staffing needs.

Although contingent workers can be hired directly, most companies turn to a third-party supplier such as a temporary staffing company that will recruit, screen, select, place and manage the temporary worker while on assignment. This allows the company to use the temporary only for the time needed, while eliminating payroll, worker's compensation and benefit expenses and responsibility, as well as related administrative costs.

The American Staffing Association (formerly the National Association of Temporary Staffing and Services) estimates that 90 percent of companies currently use temporary staffing to augment their full-time regular workforce. In 1998, ASA reported that U.S. companies spent $72 billion on temporary staffing services, driving average daily temporary staffing employment to 2.9 million. According to the Bureau of Labor Statistics, employment of temporary workers is expected to increase 53 percent-nearly 1.4 million jobs-from 1996 to 2006, making the temporary staffing industry one of the fastest growing in the economy.

As temporary staffing becomes a more permanent solution for many organizations, HR professionals have looked for ways to better optimize this resource and improve the return on their investment. As a result, best practices have evolved around the use of contingent staffing, and can be segmented into the following categories:

Strategic Staffing Plans

When temporary staffing was initially introduced many years ago, companies turned to staffing services only for lastminute, emergency-based needs. A clerical or "secretarial"worker would be brought in to cover the phones or fill in on a short-term basis for a regular employee during vacation or maternity leave.

Today, companies have expanded their use of contingent staffing to include temporary lawyers, software engineers, editors, accountants and other professionals who have a significant impact on the organization and its internal and external customers. The volume and frequency of using temporary workers has also increased significantly, and in some companies-particularly during peak project periods-temporary workers can represent up to 40 or 50 percent of the total workforce.

Best-practice companies use temporary workers to manage business peaks and valleys and also to augment their staffing plan in other ways:

To bridge the labor gap by using temporary workers to fill existing open positions until regular hires are made.

-To source and screen potential regular hires.

-To address retention issues in high-turnover areas (call centers, for example) by developing a temporary-- staffing model with shortterm expectations.

Best-practice companies strive to anticipate their temporary-staff-ing needs, approach this resource strategically, and incorporate the contingent staffing solution into their overall staffing plans. This involves the following:

Determining in advance the likely ebb and flow of business and projects and based on anticipated need, establishing the volume and skill set of temporary workers required for the designated planning period, (which is typically quarterly and annually.)

Creating a budget for temporary spending.

Establishing management information reports that monitor spending and other key data.

Contingent Staffing Models

There are numerous contingent-staffing models being used in organizations today, and the pendulum has swung back and forth between a couple of basic models.

At one time, companies relied on multiple staffing services, believing there was value in having more suppliers to choose from. This meant placing an order or orders for temporary workers with several services. …

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