The global market for temporary labor is currently valued at $463.1 billion, according to Beroe Inc., a procurement intelligence firm. Some of the leading growth drivers of the temporary labor market are the high demand for SOW (statement of work) and IT professionals, and growth in the gig economy.
The need for a flexible workforce drives the market for temporary labor, especially in the APAC region. Gig economy is a rising trend in APAC, especially in Singapore and Malaysia, where the growth of online platforms supports the concept. The strategic value additions that temporary labor can bring into the overall workforce have been recognized. Therefore, it is increasingly being adopted in regions such as North America and Western Europe.
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The need for temporary IT professionals is growing globally, which in turn drives the growth of professional temporary staffing. The demand for temporary labor is increasing in the transportation and logistics industry due to the growth in warehousing, trucking, and other manufacturing sectors, which further acts as a growth driver for the industry. The emergence of Human Cloud and VMS (vendor management system) has also had a positive effect on the industry as it makes the process better controlled and manageable.
In developed markets, the trend adopted by organizations is to ensure that temporary labor is utilized to the farthest extent possible as it is cost-efficient and flexible. The alternate to temporary labor is permanent staffing, which would be a less-preferred option for buyers. In emerging markets, there’s an increasing acceptance of temporary jobs due to a gradual decrease in the difference between the remuneration for temporary and permanent employees.
- The demand for temporary labor would increase until 2020 due to the implementation of Brexit as global firms are shifting their focus to other EU nations.
- Due to the increasing usage and preference of temporary workers, organizations have adopted MSP (managed service provider) programs for standardizing the process, worker classification, supplier selection, reporting & tracking, order distribution, and spend consolidation.
- The major cost factors for staffing services is basic wages that are paid to the temporary labor. This includes the servicing cost, cost of recruitment, direct costs & sales commissions, which constitutes 65 – 90 percent of the cost of services.
- The most preferred sourcing model in the temporary labor market is hybrid MSP as the involvement of the buyer is low and the difficulty in filling the positions is moderate with high ROI (return on investment) potential and moderate complexity in the process.
- In Brazil, employers have stated that they shall reduce the pay by 30 percent, whereas in the UK, basic pay is expected to increase by 4.7 percent. Thus, the remuneration varies from nation to nation, but it is expected to be positive on a global scale.
The research methodology adopted for the report included:
- Experts with twenty years of domain experience
- Interaction with buyers
- Inputs from supply chain partners
Growth in robotics and artificial intelligence could result in automation of jobs, where a majority of blue-collar temporary workers are employed. Therefore, the onset of such technologies could result in temporary labor being replaced with the cost savings and efficiencies factors, which comes with technology. Moreover, hiring an extensive talent pool of temporary laborers results in the expenditure of basic essentials such as workstations, computers, etc., which could lead to an increase in cost-per-hire.
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The report also includes:
- Global Market Maturity
- Global Industry Trends
- Drivers and Constraints
- What is MSP?
- Regional Market Outlook
- Industry Outlook
- Porter’s Five Forces Analysis
- Supply Market Outlook
- Global MSP Suppliers’ Grid
- Global Supplier Profiling
- SWOT Analysis
- Key Global Suppliers: Staffing Agencies,
Cost & Pricing Analysis
- Cost Breakup and Analysis
- Cost Breakup and Analysis for MSP
- Tactical Sourcing Benefits of Implementing
Procurement Best Practices:
- Sourcing Models
- Key Success Factors for MSP
- Master Vendor vs. Vendor Neutral MSP Model
- Pricing Models: Comparative Analysis
- Regional Pricing Best Practices
- KPIs and SLAs
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