It turns out America runs on contractors (sorry, Dunkin’!)—and contractors are often running to keep up with demand (could be that they run on Dunkin’, but hey, no free ads).
According to HR tech platform Gusto’s 2021 analysis of its 200,000+ clients, since 2017, contractor hiring is up 48%. In 2021, Gusto reports, one contractor is hired for every five employees. A Gusto survey accompanying the analysis helps explain why: One-third of US business owners that responded said their “company’s success is dependent on having access to contractors.”
For employers, the main advantage of contractors is that they’re on call as needed—they come aboard temporarily to help ramp up a project and then transition off when an organization is ready to scale down. However, their transience can be a double-edged sword, for both HR and the contractors performing the work.
In part due to increased demand, at least some contractors, like IT professionals, writers, and marketers, are now working harder for more clients. Upwork, a talent-management platform for freelancers, surveyed US-based freelancers in 2020 and found that over half reported juggling more than five clients in the past six months; 61% said they had enough work or more work than they wanted.
It comes as no surprise that these workloads lead to longer hours: 65% of freelancers surveyed in the same study reported increasing or maintaining the number of hours they work since the pandemic began.
Contractors can fall under HR’s supervision. As an example, Upwork routinely contracts between 1,200 and 1,600 freelancers at any given time—basically twice the number of corporate employees on payroll.
Zoë Harte, Upwork’s chief people officer, told us she considers contractors part of her “blended team,” and she sees HR’s role as, “showing up and supporting people as they do what we hope is the best work of their career—be that as a corporate team member or somebody who’s coming in to cover a parental leave.”
That’s easier said than done when HR might know only a fraction of what’s on contractors’ extremely full plates.
Here for today. Harte said that at Upwork, contractors are often working for multiple companies simultaneously, spending “15 hours a week” on Upwork tasks before they’re off doing something else.
This setup can give employers an edge. In a call with HR Brew this January, Liz Wilke, Gusto’s principal economist, explained the increased contractor use in 2021. She said that working with contractors allowed companies to be more agile and responsive to a business landscape that’s frequently in flux.
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“Businesses are in a much more fluid and dynamic environment, and so the winning business strategy is not a 10-year strategy,” Wilke said at the time. “One of the benefits that contractors can bring is that they really do allow businesses to turn on a dime.”
Wilke and Harte both agree that partnering with contractors can be a cost-effective talent solution. As Wilke put it, “If what I really need is a great consultant who can help me set up a project for six months…it’s certainly not cost-effective for me to bring them on as an employee for a year, or two years, or whatever.”
When it comes to how contractors are filling the rest of their time, Harte admitted she’s largely in the dark.
“In older approaches to talent management, I would know exactly what [employees are] doing all the time,” Harte said. “The reality is, I don’t.”
So what about burnout? “Hustle culture, I think, quickly becomes burnout culture, and then nobody is successful,” Harte said. There are multiple avenues to reduce employee burnout, she said—from taking PTO to participating in organization “Charge-Ups,” where the entire office shuts down at the same time.
One sticking point? Harte confirmed by email that contractors don’t receive most of these benefits. According to Harte, contractors don’t receive PTO generally and to receive paid time off for company holidays, they need to meet a few “thresholds.”
Harte said she hoped that contractors are, “taking good care of themselves and taking the breaks they need,” but she conceded that she can’t guarantee they will set boundaries.
By definition, contractors can take on work outside Harte’s immediate purview, possibly overextending themselves. She said that if they choose to take on multiple gigs and work “50 or 60 hours” per week, “they choose to do [so]—that’s on them.”
“I’m not going to be the person to tell them whether or not [working 50 or 60 hours] is a great idea for them,” Harte said.—SV
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