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1
v
JUNE 2016
2
Table of Contents
• Overview
• Key Findings
• Employers are Recognizing the Benefits of New Workforce Trends
• Workforce...
3
OVERVIEW
4
Purpose and Methodology
The Workforce of the Future Survey by Burson-Marsteller, the Markle Foundation, The Aspen Instit...
5
Audience, Sample Size and Margin of Error
Audience Audience definition Sample Size Margin of Error
Employers
Employees o...
6
KEY FINDINGS
7
Summary of Key Findings
We are at a critical point in the evolution of the modern workforce. The traditional
employment ...
8
KEY FINDING: EMPLOYERS
ARE RECOGNIZING THE
BENEFITS OF NEW
WORKFORCE TRENDS
9
WORKFORCE TREND: USE OF
CONTINGENT WORKERS
10
The majority of companies are currently using independent
contractors in some capacity
60
50
66
70
3
2
3
4
37
48
31
26
...
11
Employers who use
independent
contractors
Satisfaction with independent contractors is extremely high,
even among those...
12
Independent contractors allow companies to save money on
benefits and tailor their workforce by size and skillset
Below...
13
Those currently using independent contractors are much more
likely to see contractors as a solution for increased deman...
14
The majority of employers have used more independent contractors in
the last 5 years and those who use contractors are ...
15
WORKFORCE TREND:
ON-DEMAND ECONOMY
PRINCIPLES
16
Employers are familiar with and favorable towards the On-
Demand Economy
Respondents were shown the following definitio...
17v
Both employers and workers see the On-Demand Economy as a completely
different way of doing business, and agree that t...
18
Nearly half of Employers feel they will use and provide more
On-Demand Economy services in the next five years
Which of...
19
Employers who will use and provide more On-Demand Economy services
are optimistic about the On-Demand Economy’s benefit...
20
WORKFORCE TREND:
AUTOMATION
21v
Employers have and will move towards more automation, but right now
automation is limited by the scale of the company
...
22
Employers are split as to whether automation will replace workers, or allow
more workers to be hired through efficiency...
23
KEY FINDING: COMPANIES HAVE
DOUBTS ABOUT THE
CONTINUING APPLICABILITY OF
THE SOCIAL CONTRACT
24
The strong majority of employers feel that companies will
move towards a more on-demand labor model
Do you agree or dis...
25
Almost 7 in 10 agree the social contract should be reformed
for independent contractors
How much do you agree with the ...
26
Employers and workers disagree on whether workers
should be provided benefits
Do you agree or disagree with the followi...
27
There’s a large discrepancy between benefits offered to
full-time workers and independent contractors
Please indicate w...
28
Two-thirds of employers feel they should not be responsible for providing benefits
to independent contractors, but don’...
29
KEY FINDING: COMPANIES
PREFER TRADITIONAL
EMPLOYMENT FOR NOW
30
Employers prefer hiring full-time employees and think full-time
employees provide value over the long term
Companies Pr...
31
Employers evaluate full-time employees and independent
contractors on the same criteria
You will now see a list of attr...
32
Offering benefits to employees remains a critical component
of attracting talent, and employers expect workers to grow
...
33
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Conclusion
There are plenty of signs indicating traditional employment is still the most common model
governing the wor...
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Workforce of the Future Presentation

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Workforce of the Future Presentation

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Workforce of the Future Presentation

  1. 1. 1 v JUNE 2016
  2. 2. 2 Table of Contents • Overview • Key Findings • Employers are Recognizing the Benefits of New Workforce Trends • Workforce Trend: Use of Contingent Workers • Workforce Trend: On-Demand Economy Principles • Workforce Trend: Automation • Companies are Questioning the Social Contract • Companies Prefer Traditional Employment for Now
  3. 3. 3 OVERVIEW
  4. 4. 4 Purpose and Methodology The Workforce of the Future Survey by Burson-Marsteller, the Markle Foundation, The Aspen Institute Future of Work Initiative and TIME sheds light on how hiring practices have been and will be affected by new models of employment such as contingent work and the On-Demand Economy. From June 5-16, 2016, Penn Schoen Berland (PSB) conducted 800 interviews with employers, defined as: Employees or business owners who make hiring decisions for their organization. The margin of error for the total sample is +/- 3.46% and larger for subgroups. This survey builds off the November 2015 On-Demand Economy Survey by Burson-Marsteller, The Aspen Institute and TIME, which surveyed 3,000 adult Americans to understand the size and composition of the On-Demand Economy in the United States and to provide insights into trends surrounding the On-Demand Economy and its participants (both workers and users). There are interesting parallels between the two surveys and particularly between the opinions of workers and employers about this new way of doing business. Therefore, there are times throughout this presentation where the results from both surveys are compared. Overview
  5. 5. 5 Audience, Sample Size and Margin of Error Audience Audience definition Sample Size Margin of Error Employers Employees or business owners who make hiring decisions for their organization 800 +/- 3.46% • Company Size: 1-100 Employees Employers whose organizations employ 1-100 people. 357 +/- 5.19% • Company Size: 100-1000 Employees Employers whose organizations employ 100-1000 people 252 +/- 6.17% • Company Size: 1000+ Employees Employers whose organizations employ more than 1000 people 191 +/- 7.09% • Uses Independent Contractors Employers whose organizations use independent contractors 478 +/- 4.48% • Does not use independent contractors Employers whose organizations do not use independent contractors 322 +/- 5.46% • Will use more independent contractors Employers who state that in the next 5 years their organizations will use more independent contractors 331 +/- 5.39% • Will use fewer independent contractors Employers who state that in the next 5 years their organizations will use fewer independent contractors 331 +/- 5.39% • Will use and provide more On- Demand Economy services Employers who state that in the next 5 years their organizations will use and provide more On-Demand Economy Services 280 +/- 5.86% • On-Demand Economy Workers From The Future of Work Survey: People who offer services as part of the On-Demand Economy 645 +/- 3.86% Overview
  6. 6. 6 KEY FINDINGS
  7. 7. 7 Summary of Key Findings We are at a critical point in the evolution of the modern workforce. The traditional employment model is shifting as companies increasingly use contingent workers and embrace the principles of the On-Demand Economy. These trends have the potential to change conventional employment and are forcing employers to reevaluate the social contract and other core elements of the employer-worker relationship. Though the workforce has not yet changed dramatically, it is clear that we are witnessing a fundamental shift. 1. Employers are Recognizing the Benefits of New Workforce Trends Independent Contracting and On-Demand Economy forces are becoming key parts of the workplace and present clear cost and scalability benefits, threatening the traditional employment model. 2. Companies Have Doubts About the Continuing Applicability of the Social Contract New workforce trends are making companies re-evaluate the social contract, and the relationship between employers and workers is evolving. 3. Companies Prefer Traditional Employment Arrangements for Now Employers prefer traditional employment and will still hire full-time employees instead of contractors when they can, because full-time employees provide more long-term value and are more invested in their companies. Overview
  8. 8. 8 KEY FINDING: EMPLOYERS ARE RECOGNIZING THE BENEFITS OF NEW WORKFORCE TRENDS
  9. 9. 9 WORKFORCE TREND: USE OF CONTINGENT WORKERS
  10. 10. 10 The majority of companies are currently using independent contractors in some capacity 60 50 66 70 3 2 3 4 37 48 31 26 All Employers 1-100 Employees 100-1000 Employees 1000+ Employees Respondents were shown the following: We would now like to ask you some questions about your company and workforce. The next series of questions are about non-employee contingent workers. These are workers who work for an organization on a non-permanent basis and typically work on a Form 1099, as opposed to full time, W2-based employees of an organization. Contract or non-employee contingent workers are also known as freelancers, independent contractors, or temporary contract workers. They do not include workers, part time or full time, who are issued a Form W2. Does your organization use non-employee contingent workers? Showing % Yes Don’t know No Workforce Trends: Contingent Workers …And they use these workers predominantly for low-skilled work or ad-hoc projects
  11. 11. 11 Employers who use independent contractors Satisfaction with independent contractors is extremely high, even among those who say they will hire fewer in the future IF USES INDEPENDENT CONTRACTORS: Generally speaking, how satisfied have you and your organization been with the performance of the non-employee contingent workers that you’ve used? Showing % 50 45 59 47 53 36 -3 -2 -5 Total % Very Satisfied Don’t know Total % Somewhat dissatisfied Total % Somewhat Satisfied Total % not Satisfied at all Will use more independent contractors Will use fewer independent contractors 97% satisfied 98% satisfied 95% satisfied Workforce Trends: Contingent Workers
  12. 12. 12 Independent contractors allow companies to save money on benefits and tailor their workforce by size and skillset Below is a list of potential arguments an organization could make in favor of hiring a non-employee contingent worker instead of a full-time, W2-based employee. Please indicate whether, based on your experience, you agree or disagree with these arguments for hiring non-employee contingent workers. Showing % among employers who use independent contractors, Ranked by Total Agree 41 50 37 36 41 33 36 34 35 34 29 29 26 28 26 23 17 49 36 47 47 41 49 43 45 43 44 49 44 45 40 39 41 33 1 1 1 4 1 1 1 1 1 2 3 1 2 3 7 10 13 13 13 13 14 15 17 15 15 22 21 21 23 24 37 3 3 2 3 4 4 4 5 5 6 6 3 6 9 11 10 10 Allows my company to quickly adjust our workforce as needed Saves my company money on benefits Allows for completion of specific tasks or deliverables Their flexibility makes it easier to find workers right away Allows for hiring more specific skills Non-employee contingent workers can start working right away It is simpler dealing with the tax situation of non-employee contingent workers Saves my company money on administrative costs Saves my company money on salary The process of hiring non-employee contingent workers is simpler Non-employee contingent workers have fewer demands and expectations Allows for greater choice of candidates It is easier to find non-employee contingent workers My organization spends less on tools, equipment, and office space My organization spends less on training Non-employee contingent workers take less time to train and get up to speed Non-employee contingent workers are more efficient % Strongly Agree Don’t know % Somewhat Disagree % Somewhat Agree % Strongly Disagree Workforce Trends: Contingent Workers
  13. 13. 13 Those currently using independent contractors are much more likely to see contractors as a solution for increased demand 56 41 77 2 2 3 42 58 20 All Employers Uses Independent Contractors Does not use Independent Contractors Which of the following is closest to your view? Showing % Contracting work out makes it easier to accommodate ebbs and flows in demand and work volume than having a full-time employee because we pay for work only when we need to. Having a full-time employee on hand is easier to accommodate the ebbs and flows in demand and work volume because they are trained to do the job and can react quicker. Don’t know Workforce Trends: Contingent Workers
  14. 14. 14 The majority of employers have used more independent contractors in the last 5 years and those who use contractors are most likely to use more in the next 5 years 41 31 17 12 41 57 All Employers Uses Independent Contractors …more independent contractors. …fewer independent contractors. Don’t know In the next five years, my organization will use… 36 31 2 1 62 67 All Employers Uses Independent Contractors …more independent contractors. …fewer independent contractors. In the last five years, my organization is using… Workforce Trends: Contingent Workers
  15. 15. 15 WORKFORCE TREND: ON-DEMAND ECONOMY PRINCIPLES
  16. 16. 16 Employers are familiar with and favorable towards the On- Demand Economy Respondents were shown the following definition: The On-Demand Economy can be defined as an industry that encourages consumers to share use of goods and services rather than own them individually. Using online technology, consumers have access to goods and services provided by companies and other consumers, and can use those goods and services when needed and offer their time or property to earn extra income. Services within the On-Demand Economy typically include ride sharing, accommodation sharing, on-demand professional services and food delivery, and on-demand car rental services. Workers in the On-Demand Economy are principally non- employee contingent workers. Proponents of the On-Demand Economy argue that this provides workers with added flexibility, while critics argue they do not have the same benefits as traditional full-time employees and their status is a cost-saving mechanism for the companies of the On-Demand Economy. This economy has also been called the sharing economy, gig economy, or 1099 economy. 71% of employers say they are familiar with the On-Demand Economy 68% say they are favorable towards the concept Workforce Trends: On-Demand Economy Principles 35% say they will use and provide more On-Demand Economy services in the next 5 years
  17. 17. 17v Both employers and workers see the On-Demand Economy as a completely different way of doing business, and agree that the On-Demand Economy creates wage-earning opportunities Which of the following is closest to your view? Showing % The On-Demand Economy is… Workforce Trends: On-Demand Economy Principles 30 34 31 7 1 7 62 65 62 All Employers Will use and provide more On-Demand Economy services in the future On-Demand Economy Workers …a completely different way of doing business …not that different from the traditional way of doing business 39 22 32 10 11 52 78 57 All Employers Will use and provide more On-Demand Economy services in the future On-Demand Economy Workers …creating more opportunities for workers by bringing more wage- earning opportunities to more people. …eliminating traditionally secure jobs and creating part-time, low-paid work. The On-Demand Economy is… Don’t know
  18. 18. 18 Nearly half of Employers feel they will use and provide more On-Demand Economy services in the next five years Which of the following is closest to your view Showing % among All Employers In the next five years, my organization will… …use more On-Demand Economy services …use fewer or no On- Demand Economy services. Don’t know 34 19 47 Workforce Trends: On-Demand Economy Principles …be providing more On-Demand Economy services …not be providing more On-Demand Economy services In the next five years, my organization will… 42 15 43
  19. 19. 19 Employers who will use and provide more On-Demand Economy services are optimistic about the On-Demand Economy’s benefits Do you agree or disagree with the following statements: Net Agree (total agree-total disagree), ranked by employers whose organizations will use and provide more On- Demand Economy services in the future 75 70 69 67 61 54 47 24 23 38 49 30 33 30 17 49 24 24 The On-Demand Economy will make it easier for workers to develop skills that make them competitive in the job market The On-Demand Economy will give more opportunities for work for more people The On-Demand Economy will make it easier for workers to build careers The On-Demand Economy is good for society Working in the On-Demand Economy is a good source of primary income Some full-time jobs and tasks within my organization could easily be replaced by On-Demand Economy services The On-Demand Economy helps companies take advantage of workers by not providing benefits and protections On-Demand Economy companies are exploiting a lack of regulation for immediate growth The move towards an On-Demand Economy will mean workers will have fewer opportunities for training Workforce Trends: On-Demand Economy Principles Net Agree, All Employers Net Agree, Employers whose organizations will use and provide more On-Demand Economy services in the future
  20. 20. 20 WORKFORCE TREND: AUTOMATION
  21. 21. 21v Employers have and will move towards more automation, but right now automation is limited by the scale of the company Which of the following is closest to your view Showing % 36 54 24 18 2 2 1 5 62 45 75 77 All Employers 0-100 Employees 100-1000 Employees 1000+ Empoyees …invested in automating more tasks and functions …not invested in automating more tasks and functions 25 38 16 10 7 8 4 8 68 53 80 81 All Employers 0-100 Employees 100-1000 Employees 1000+ Empoyees …invest in automating tasks and functions …not invest in automating tasks and functions Don’t know In the last five years, my organization has… In the next five years, my organization will… Workforce Trends: Automation
  22. 22. 22 Employers are split as to whether automation will replace workers, or allow more workers to be hired through efficiency Which of the following is closest to your view? Showing % 40 31 48 46 13 21 5 9 47 48 47 45 All Employers 0-100 Employees 100-1000 Employees 1000+ Empoyees Automation in my organization will lead to more workers being replaced as technology allows it to operate leaner. Don’t know Automation in my organization will allow more workers to be hired as technology allows it to grow. Workforce Trends: Automation
  23. 23. 23 KEY FINDING: COMPANIES HAVE DOUBTS ABOUT THE CONTINUING APPLICABILITY OF THE SOCIAL CONTRACT
  24. 24. 24 The strong majority of employers feel that companies will move towards a more on-demand labor model Do you agree or disagree that more companies and organizations will move towards more of an on- demand labor model? Showing % 70 75 64 88 10 6 15 3 20 19 21 9 All Employers Uses Independent Contractors Does not use Independent Contractors Will use and provide more On-Demand Economy services in the future % Total Agree Don’t know % Total Disagree Companies Have Doubts About the Continuing Applicability of the Social Contract
  25. 25. 25 Almost 7 in 10 agree the social contract should be reformed for independent contractors How much do you agree with the following statement: The social contract – whereby health, retirement, and other benefits are generally tied to traditional, full-time W2-based employment – should be reformed as more workers move towards independent contract work? Showing % 20 20 20 32 48 50 45 52 7 5 10 1 16 17 15 9 9 8 10 5 All Employers Uses Independent Contractors Does not use Independent Contractors Will use and provide more On- Demand Economy services in the future % Strongly Agree Don’t know % Somewhat Disagree % Somewhat Agree % Strongly Disagree Companies Have Doubts About the Continuing Applicability of the Social Contract
  26. 26. 26 Employers and workers disagree on whether workers should be provided benefits Do you agree or disagree with the following statements: Showing % Net Agree (total agree – total disagree) 52 37 34 28 27 27 21 -12 44 44 40 54 28 24 32 11 Net Agree, All Employers Net Agree, On-Demand Economy Workers On-Demand Economy workers don't have the financial safety net other workers do On-Demand Economy services are reliable On-Demand Economy companies are trustworthy On-Demand Economy workers should be given more benefits as part of their job On-Demand Economy companies care about peoples’ privacy On-Demand Economy companies don't invest in training of their workers On-Demand Economy companies care about their workers On-Demand Economy workers have the same job security as employees at traditional companies Companies Have Doubts About the Continuing Applicability of the Social Contract
  27. 27. 27 There’s a large discrepancy between benefits offered to full-time workers and independent contractors Please indicate which of the following benefits your organization offers to full-time, W-2 employees and to non-employee contingent workers. Select all boxes that apply. Showing %, ranked by benefits provided to full-time employees 80 80 76 72 70 70 68 68 66 56 51 47 46 40 33 32 17 13 26 19 12 14 22 19 15 16 14 13 32 13 21 19 Healthcare Paid vacation Tax withholding Maternity leave 401k Dental Bereavement leave Family leave Vision Paternity leave Education Reimbursement Non-401k retirement planning options Work from home Stock options Public transportation subsidies or reimbursements Parking reimbursement Offered to full-time, W2-based employees (among All Employers) Offered to independent contractors (among employers who hire independent contractors) Companies Have Doubts About the Continuing Applicability of the Social Contract
  28. 28. 28 Two-thirds of employers feel they should not be responsible for providing benefits to independent contractors, but don’t agree on who should Which of the following parties do you believe should be responsible with providing benefits for non-employee contingent workers? Showing % among All Employers 22 18 9 6 4 1 6 Workers themselves Private companies that help workers manage/gain benefits The government Worker associations Unions Other Don't know From employers …And half of employers do not believe they are responsible for providing training to independent contractors 34 66 Not from Employers Companies Have Doubts About the Continuing Applicability of the Social Contract
  29. 29. 29 KEY FINDING: COMPANIES PREFER TRADITIONAL EMPLOYMENT FOR NOW
  30. 30. 30 Employers prefer hiring full-time employees and think full-time employees provide value over the long term Companies Prefer Traditional Employment for Now Which of the following is closest to your view Showing % My company generally seeks to limit the number of full time employees in favor of non-employee contingent workers. Hiring a non-employee contingent worker is better for my organization because it saves us money on taxes and benefits we would otherwise have to pay hiring a full-time employee. My company generally seeks to limit the number of non- employee contingent workers in favor of full- time employees. 67 63 73 6 5 9 27 33 19 All Employers Uses Independent Contractors Does not use Independent Contractors 58 49 71 5 3 7 37 48 21 All Employers Uses Independent Contractors Does not use Independent Contractors Hiring a full-time employee is better for my organization because they provide more value over the long term despite having to pay more up front on taxes and benefits. Don’t know
  31. 31. 31 Employers evaluate full-time employees and independent contractors on the same criteria You will now see a list of attributes someone might take into account when considering a candidate for hire. Please drag these attributes into the adjacent container in order of their importance when considering... Showing Attributes Ranked by employers who use independent contractors Past Professional Experience Relevant Years of Work Education Professional Portfolio Writing and Speaking Ability References Desired Compensation Professional Network Cultural Fit Past Professional Experience Relevant Years of Work Education Professional Portfolio Writing and Speaking Ability References Desired Compensation Professional Network Cultural Fit 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 A full-time, W2-based employee: An Independent Contractor: Companies Prefer Traditional Employment for Now
  32. 32. 32 Offering benefits to employees remains a critical component of attracting talent, and employers expect workers to grow with their companies Which of the following is closest to your view? Showing % 79 3 18All Employers Providing workers with benefits is necessary to attract and retain workers. Don’t know Providing workers with benefits is not necessary to attract and retain workers. 78 3 19All Employers I expect workers to stay on and grow their careers with my organization in the long term. Don’t know I expect workers to stay on with my organization in the short term, then find an opportunity elsewhere. Companies Prefer Traditional Employment for Now
  33. 33. 33 16 14 15 12 12 11 10 12 10 10 12 8 10 42 40 37 35 31 32 33 30 30 25 22 26 22 1 1 1 2 1 1 1 1 2 1 2 2 24 31 31 33 34 35 36 33 35 39 35 40 38 17 13 15 20 22 21 19 24 24 24 30 24 28 Non-employee contingent workers are not as loyal Non-employee contingent workers are not always available when I need them Non-employee contingent workers are not as invested in their product Non-employee contingent workers are harder to retain Non-employee contingent workers are not as reliable Non-employee contingent workers do not understand my organization or objective Relying on non-employee contingent workers increases administrative burden… Non-employee contingent workers are not as skilled as full-time employees Non-employee contingent workers are not as motivated Non-employee contingent workers take longer to train and get up to speed Non-employee contingent workers are more expensive It is harder to find non-employee contingent workers The process of hiring non-employee contingent workers is more difficult % Strongly Agree Don’t know % Somewhat Disagree % Somewhat Agree % Strongly Disagree Employers are looking for engaged, loyal employees and independent contractors do not meet that expectation Below is a list of potential arguments an organization could make against hiring a non-employee contingent worker instead of a full- time, W2-based employee. Please indicate whether, based on your experience, you agree or disagree with these arguments. Showing % Total Agree (Strongly + Somewhat Agree) among employers who use independent contractors Companies Prefer Traditional Employment for Now
  34. 34. 34 Conclusion There are plenty of signs indicating traditional employment is still the most common model governing the workplace. But, dig a little deeper, and one can see some changes to the traditional model as a result of emerging workplace trends: • Most companies today are using independent contractors in some capacity and are satisfied with their work • The criticism against contingent workers is they are not as invested in the company they work for or their output as much as full-time employees • Employers feel companies will, in time, move to a more On-Demand labor model and agree On-Demand Economy principles signal a shift in how work gets done Given these factors, it is clear that the short-term benefits of contingent workers and long-term value of full-time employees are odds in today's economy, and as employment models change, so too will the employer-worker relationship. Conclusion

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