In this Article, I am going to discuss with you about IT Contingent Workforce Market and how to create opportunities for Job as well as start Business by yourself. I will show how Americans from rural areas can jump in and make money without leaving their hometown; especially not investing any significant capital. There are a lot of potential talent an average American possesses that can be harnessed to be successful in this market.
Contingent workforce market is a $121 Billion dollar market in the US. Some of the facts…
- In 2015, the U.S. Department of Labor found that 65 percent of employers anticipate an increase in the use of flexible staffing arrangements to meet their future talent needs.
- In Deloitte Consulting’s Global Human Capital Trends 2015 whitepaper, more than half (51 percent) of respondents said their need for contingent workers would keep growing over the next three to five years.
- A recent survey conducted by research firm Ardent Partners found that about 30 percent of company workforces are now made up of non-full-time employees, growing to 50% by 2020.
For those who does not have any idea of this business, let me explain how this industry works: There are at least three parties involved in the entire business model. The End Client(where the IT worker is going to report), the primary supplier and the Employee(IT worker). Now depending on the situation, there will be a secondary supplier who works under the primary supplier. An individual worker becomes an employee of primary or secondary and then the primary sources the candidate to the End Client. The worker delivers work for the end client, and the primary invoices the end client and secondary invoices the primary. The employee works on W2(preferably) or 1099 with primary or secondary.
Since the business process model is very simple and lucrative, this industry was bread and butter for millions of American companies & small time business owners and work from home human resource staffers for many decades. Then came the recession in 2008 that created a big dent in the business opportunity for many American companies. With the economic collapse, many of the companies were forced to work on lower rates and less number of contingent workers. So, the American companies who were employing American recruiters and American finance & admin support workers had to lay off many of them to stay afloat. But with the reduced recruiters and support staff they could not place more contingent workforce with the client. By then BPO outsourcing / call center industry was already working well for other business units for clients, the many companies that had access to offshore BPO centers in India, Philippines, Brazil, Ireland and other lucrative destinations. Started hiring recruiters in those countries. With the advanced technological development in telecom and internet, it was too easy to get the US phone numbers and make calls as if they are working within the USA. While many companies used offshore outsourcing as a strategy to cut down cost and stay ahead of the game, many companies went out of business as for the cost of every recruiter in the USA; the outsourced staffing companies were hiring ten offshore recruiters. It is a sad story of many people going out of business, and many US recruiters getting laid off or switch over to other low paying jobs.
While we can blame the businesses for offshore outsourcing, we also should understand that every business will do this for staying in business and be profitable, given opportunity and access. It created an unfair competition between US-based companies and foreign operated(outsourced) companies. There was a huge wealth shift from thousands of smaller staffing first to a handful of larger companies who went offshore(or increased their offshore presence). Now, while the trend cannot be reversed, even with the new government policies, there is something Americans do to take back this business to the US from offshore locations. Being an insider, I know the vulnerability and the issues these companies are already facing.
- Offshore workers are failing in many situations not understanding the US business processes.
- The overall productivity & results are already showing bad figures from the offshore recruiters.
- With increased enforcements of H1B regulations, many companies are vulnerable to break Labor and USCIS laws due to the poor management and process compliance issues by offshore teams.
- Increased inflation and cost in the foreign countries are slowly burning the cost benefits.
At digiBlitz, we understood these issues very well and as a result, we had created and Alternate platform for success for American companies & professional HR recruiters to get back to the track and be profitable. It is called “menschForce.” It works on very simple philosophy, – Increase the productivity & results by automating the recruitment & compliance processes. With this platform, we made it easy for any American to get into the staffing business with very little investment and beat the offshore companies. The automation brings in Robots in place of offshore workers. I know you may find it difficult to digest this. Let me explain further…
While offshore companies were getting cost benefits of engaging offshore workers, these offshore workers mostly were doing non-core recruitment process activities. i.e., about 80% of their time goes to non-core repeatable activities while only 20% was on productive recruitment. Menschforce is designed to automate this 80% of the work with the robotic processes. So, an American recruiter needs to spend only 20% of their time to show the result in competing with the offshore workers. And not only that, American companies / staffing worker can create as many of these Robots possible their by creating an unlimited number of competitors for offshore workers paying a very less fee. This puts the American company back to business and the American recruiters back to Job.
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