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The key challenges facing the future of work

We need to start thinking differently about contingent workers

Future of Work|Talent|Total Rewards
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By Tracey Malcolm | September 30, 2019

Contingent workers will change how companies operate creating new challenges from outside and inside the organization.

Digital transformation in the workplace is a new reality that is requiring organizations to develop new digital capabilities.

As automation expands, its impact on talent sourcing and job design will increase, resulting in new combinations of humans and automation to get work done, including a more diverse talent mix with contingent workers.

Consider:

  • The past three years alone have already seen a rise in the use of contingent workers — three years ago, seven in 10 organizations were already using non-employee talent.
  • The proportion of work completed using automation has more than doubled in the past three years alone, from 8% to 17%, and it’s expected to hit 30% three years from now, according to the results of Willis Towers Watson’s 2019 Global Pathways to Digital Enablement Survey.
  • Within three years, more than 90% of organizations are expected to use automation to get work done.

Looking forward, more organizations expect to increase their use of contingent talent and, as humans and automation converge. These companies plan to redesign jobs to both raise and lower skill requirements. The increasing sophistication of the skills that contingent workers possess combined with the work expected from them and the growing premium placed on speed is encouraging more organizations to leverage contingent talent.

However, there are challenges beyond finding the right people with the right skills at the right time.

Political

Just as the gig economy is evolving, so too are the laws with respect to the classification of workers. On September 18, California Governor Gavin Newsom signed legislation that challenges independent contract work, redirecting this evolution to a traditional model of employees (with a minimum wage, overtime pay, eligibility for unemployment insurance and workers’ compensation).

This change could upend how organizations approach the options for getting work done. Organizations that currently rely heavily on contingent workers for key roles may further adapt their business models or increase levels of automation for completely autonomous work. In turn, contingent workers will feel the pinch as companies pull back hours, institute strict schedules and cut staff. In other words, the legislation may have unintended consequences for companies and talent that are embracing the future of work.

Talent Experience

In today’s work world, the traditional career path is making way for a portfolio of broad and nonlinear work experiences. And given the changing face of the workforce, it’s critical for companies to take a fresh view of the talent experience. Forward-thinking organizations understand that the winning combination for any business occurs when human and business goals meet, and the definition of a “positive talent experience” is very much in the eye of the beholder.

These companies think about accessing the entire talent pool. They also embody agile thinking— regardless of job status — as they match a diverse mix of talent to work based on skill, motive or the flexibility inherent in the work. We know from our research that organizations that successfully integrate contingent workers with automation and their regular-employee teams are reaping benefits in the form of financial performance, innovation and less disruption in the short term.

Understanding the impact of automation and digitalization on both the workforce and the business overall will put companies in the best position to gain a competitive advantage. And, as the use of contingent labor continues evolving, it’s critical for companies to proactively embrace a new mix of workforces to effectively compete for highly skilled talent. Organizations that are capable of that transformation are the ones that will win.

Contact

Tracey Malcolm
Global Future of Work Leader, Human Capital & Benefits practice

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