Can you create a direct recruitment strategy for your contingent workforce in the same way you would for permanent hires?

Bringing in a contractor can be a flexible and quick way to fill a skills gap and support a particular project.  Traditionally to recruit a contractor an employer might go out to their agency PSL, receive a shortlist of suitable contractors, interview them, and make an offer. If accepted payroll is taken care of by the agency, and the employer pays the agency an invoice at the end of the month, with a mark-up on the contractor day rate probably somewhere between 12-15% depending on what you’ve negotiated.  Simple!

There are a number of benefits to this tried and tested approach.  Firstly the sourcing and headhunting of the contractors is done for you (a huge advantage if you don’t have access to relevant pools of talent).  Secondly you don’t need to worry about pay-rolling or co-employment issues associated with hiring contractors directly.  You save time and don’t need to invest in systems to help manage your contractor population.

But with the variety of new sourcing tools and technology now available to in-house recruiters, could a larger portion of the market now develop direct recruitment strategies for contractors, in the same cost effective way we are seeing for permanent hires? Furthermore can this be achieved without compromising on speed and quality of hire and without the post-hire contractor management being too burdensome?

Over the last few years new technology platforms have begun entering the market offering corporate recruiters a solution to source contractors, make job offers, and take care of the invoicing, payroll, time-sheeting etc for a fraction of the mark-up compared to traditional agency suppliers.  They are kind of like match.com but for in-house recruitment.

Technology examples:

YunoJuno for example is a niche platform where freelance creative types can upload a profile, and employers can filter through them based on skills, availability etc. Time-sheeting and consolidated invoicing is managed via the platform.

YunoJuno

 

Elevate Direct, another end to end solution for the wider contractor market, uses advanced matching technology to compare registered contractors with an employers job, automatically generating a shortlist of suitable contractors for the hiring manager based on skills, day-rate etc. Essentially it takes care of the sourcing work and allows recruiters to engage directly with a previously inaccessible talent pool.

Elevate-Direct

All engagement between contractor and employer, offering of a job/contract etc is taken care of within Elevate Direct. The headache of needing payroll systems, timesheet management etc is again taken care of by the platform and the employer receives a consolidated invoice so they don’t need to go about creating new suppliers for each and every contractor.

Transparency & cost:

Another advantage of these platforms is the transparency they provide to employers and contractors. Employers can view the actual contractor day rates and in exchange for recruiting via the platform only pays a mark-up of between 4-6%. This can generate significant cost savings for employers.

  • Consider a contractor on a day rate of £400 recruited via an agency
  • We’ll assume they were hired at a nominal mark-up value of 13%
  • The employer is paying £452 a day compared to £420 (based on a 5% mark-up) if they recruited via one of the above platforms
  • That’s a saving of £32 a day which may not initially seem like much
  • But based on a working calendar of 240 days, that soon becomes a saving of £640 a month or £7680 a year per contractor!

If you have a large contract workforce the savings can easily reach into the hundreds of thousands. Fast growing companies like Photobox have used platforms like these to successfully recruit some of their own contractors directly. They have a brief case study that can be read online here.

How-it-works

 

Opportunity for a holistic direct recruitment strategy?

  • Career sites
  • Direct sourcing via databases
  • Leveraging social networks like LinkedIn
  • Advertising on job boards
  • Aggregators
  • Building talent pools and talent pipelines
  • Talent communities
  • SEO and SEM

Above are listed some of the methods that in-house recruiters consistently use to attract candidates. Now add in automated contractor sourcing tools and the technology to efficiently process contractors attracted directly; the result is a pretty comprehensive direct recruitment strategy.

 

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