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4 Reasons Your Contingent Workers Voluntarily Leave

Voluntary turnover is significant risk, especially for organizations who rely on temporary workers. As most contracts last just six to 12 months then end, or freelance projects are few and far between, the idea of retention for “temporary” workers might not be top of mind. However, half of all companies have added or will add temporary staff at some point in 2017. Likewise, many companies continue to dip into the same pool of freelancers, or seek to re-up with their contract workers on a continuous basis. It can be costly if these people openly decide to step away.

For example, say one department within your organization relies heavily on a highly valuable freelance professional. He/she juggles multiple projects but is always available when needed. They understand your deadline-driven environment, your go to market messaging and strategy, your culture, and how your people communicate. They're reliable and efficient. If they suddenly decide to look elsehwere, you're then stuck trying to replace this role at moment's notice – not only losing time (and money) that could be spent on productivity but having to invest in quickly finding, attracting, hiring and onboarding someone new you hope is the best fit.

Toward this end, retention is stepping into the spotlight.

As highlighted by the American Staffing Association, during the course of a year US staffing companies alone hire nearly 15 million temporary and contract employees. Globally, this number multiplies tenfold! As of 2016, 13.3 percent of Canada’s workforce is made up of temporary workers. In the UK, temporary workers make up 6 percent of the overall workforce. The Poland workforce outpaces nearly all global countries, with 27.5 percent of the overall workforce being temporarily or contingently employed. As the contingent workforce continues to grow, retention among contract and freelance employees is likewise becoming an increasingly vital factor in determining which companies thrive.

In response, we must figure out why temporary and contingent workers voluntarily leave, and what can be done to overcome this growing trend:

  1. Leadership. According to a survey conducted by StaffBay, including feedback from 15,000 employed professionals, nearly 53 percent of employees who planned to leave their job over the past few years said it was because they do not trust those in charge. A recent Quantum Workplace employee engagement report further emphasizes this trend. According to the survey, trust in senior leaders has the greatest impact on an organization's overall level of engagement. It would make sense, then, that employees want to leave if they harbor bad feelings about those in charge. Companies need authentic, accountable and genuine leadership; leadership needs to live and breathe your mission, vision and values. The health of your current and future workforce, contingent and permanent, may depend on it.

  2. Work Environment. According to research conducted by Career Outcomes Matter, the biggest reason employees voluntarily leave a position has to do with losing trust in corporations. Further, according to an online survey conducted by CreativeLive, 40 percent of more than 1,120 employed professionals who want to quit their jobs say the No. 1 reason they seek to leave a given role is because of the “Corporate” environment. The research suggests employees are looking for more flexible, diverse and/or less rigid “corporate” working environments.

  3. Compensation. A 2017 study from Glassdoor offers an in-depth look at exactly what motivates people to quit their jobs. Based on analysis of more than 5,000 workers who changed jobs between 2008-2017, Glassdoor found that employee compensation is the No. 2 reason people (temporary and permanent) voluntarily leave, second only to company culture. The study also shows that a 10 percent increase in base pay raises the likelihood by 1.5 percent that the average employee will stay inside a company rather than moving on to a new organization.
  1. Stagnation. According to this same Glassdoor study, research shows that job title stagnation negatively impacts retention. Specifically, for every 10 months that pass with an employee “stagnating” in a role, they are 1 percent more likely to leave their current company when moving on to their next position, project or contract. With both No. 3 above and No. 4 in mind, professionals today have more insight and outlets to discover what they’re worth than in any year prior (via Glassdoor, recruiters, industry trends/reports, to name just a few). With temporary staff, stagnation may not be register as an issue. However, research highlights the importance of continuously evaluating pay structure and even job titles to ensure contingent workers not only accept temporary offers but give more consideration to re-upping or returning should the company go this route.

Of note, in 2016, according to the US Bureau of Labor Statistics, 18-35 year-olds had an average tenure of 1.6 years per job. By 2020, these very same 18-35 year-olds (millennials and Gen Z) will make up a whopping 50 percent of the workforce. In brief, globally, we’re less than three years from having half of the world’s labor force "planning" to stay at a company less than two years.

Companies across all regions, industries and markets are already dealing with competitors siphoning off talent, a growing skills gap for complex, niche talent, as well as ever-evolving demands from today’s professionals – and now, on top of that, tenure for 50 percent of the labor force, contingent included, is shrinking to previously unheard of levels.

Leadership, work environment, compensation and stagnation may or may not be causing your temporary or permanent talent to leave. But research shows that employees today know what they’re worth, what they want, and how to find it – ultimately, the very best contingent workers, especially millennials and Gen Z, will not hesitate to turn down the next project or contract offer if they aren’t being properly valued. Market research is a vital piece of talent acquisition and management, for both permanent and full-time workforces. Begin by finding out how you’re performing against the market, then take the necessary steps to ensure you’re doing everything possible to keep your best people right where they are.

[BLOG] What Contingent Workers Want, Why They Leave And How To Retain Them.

Industry Insights

Richard Ward

Richard supports WilsonHCG's marketing team as global communications specialist, focusing on content strategy, public relations and telling both client and WilsonHCG stories. Richard finds true joy and passion developing real, genuine relationships and connecting people across the talent landscape through inclusive and engaging content. He's an ardent coffee drinker, book-aholic and adores his English lab Maggie.