4. Fragmenting Workforce - The Extended
Enterprise
4
collaborations
outsourced front-line &
support services
consultants
micro-entrepreneurs &
on-line /crowd workers
apprentices / trainees
temps / contractors/’sub-
contractors
(CIS), Interims, etc.
full-time, part-
time & fixed-term
employees
Degree of user
organisation
patronage
Degree of state
patronage
outcomes-
based tasks Roles
5. The Fragmenting Workforce
42% of the UK workforce already works outside
the concept of full-time, „permanent‟ employment
Source: ONS – Labour Market Statistics - Sept 2013
7. Part-time working
7
Currently running at 27% of UK workforce – plateauing after
recent rises.
Most significant movement is the increase in the number who
are working part-time because they cannot find full-time work:
10% in 2008 – now 18.4%.
Source: ONS – Labour Market statistics Sept 2013
8. Apprenticeship starts and framework
achievements by level
8 Source: Skills Funding Council - Further Education & Skills: Learner Participation, Outcomes
and Level of Highest Qualification Held(June 2013 – updated Sept 2013)
9. Interest in working on a contingent basis is
rising
9
1.6 million „temps‟ in the UK – 6.5% of working population
4.2m self-employed, of which c.1.7m are „self-employed‟
freelancers
The rise of „I-pros‟ (study commissioned by PCG)
The rise in (European) I-pro numbers between 2000 and 2011 was +82%
Between 2008 and 2011 there was growth of 12.5% which was driven by
four countries; Germany, France, Poland and the UK
In same time period, UK achieved double the European growth level – UK
I-pros = 19% European total
10. Interest in working on a contingent basis is
rising
10
0% 20% 40% 60% 80% 100%
PAYE: front-line operations
PAYE: operational support
Day rate: Under £500 per day
Day rate: over £500 per day
Average of all the categories
I choose to work on a temp/contract/interim
basis
Additionally:
• 46% of employed workers considered a freelance role when last looking for
work
• 48% will consider it when looking next time
Source: Randstad World of Work Report
2011/12
11. Interest in working on a contingent basis is
rising
11
“The world of work has changed…The
intelligent individual is in control of his or her
own market, while the rest still require
patronage.”
Andreas Ghosh
Personnel and Development Director for London Borough of Lewisham (and
Policy Lead for Workforce Strategy at the Public Sector People Managers‟
Association)
Source: Randstad‟s Navigator Report 2012
12. Recruitment industry’s known share of
activity
Agenc
y 300k
Direct into
Hirer
(or Other)
1,250k
All Temporary
1,550k
Temporary (ONS: Q1 2013)
Self Employed (ONS: Q3 2012)
All I-pros
1,734k?
Sole
Ltd
168k
Agency
47k
Run
Bus/
Prof
Practice
234k
Partner
Bus/Prof
Practice
398k
Sub
contractor
408k
Freelance
479k
13. The recruitment industry’s unknown market
share
Some uncertainty around where certain worker types, in sizeable
numbers, are classified within ONS data.
Construction Industry Scheme (CIS)
797k Self-employed – March 2013.
Number of CIS workers – ONS uncertain: “Depends on how they classify
themselves and/or how they are classified by those that engage them.”
Umbrella workers
ONS is currently looking into this area to determine:
How large the pool of employed temporary workers is.
Where they are currently being classified.
Whether any potential misclassification is cause for concern (based on
the size of the pool).
14. The recruitment industry’s potential market
share
Immediately identifiable supply through
recruitment agencies/businesses equates to less
than 2% of the UK workforce…
but we know it is considerably more.
And what could it be?
15. RIB Turnover Growth & UK Job Vacancy
Growth
Source: RIB (www.rib-index.com), ONS
16. Who else is involved in sourcing &
managing the fragmented workforce ?
Recruitment Intermediaries (MSPs/RPOs)
Talent pooling
The „Service Provider‟ community.
Employed temporary workers
Intermediaries driving alternative resourcing models.
Agency sourced but directly engaged temps
Online work platforms
Crowd working
Around a quarter of employers
Flexible hours working
17. Where from and where to for managed
programmes?
Managed Services
(MSPs/RPOs)
Regional Global
Varied Skill categories
All categories
Fundamental technology
Advanced VMS
Selected industries
All industries
Outsourced Workforce
Solutions
IC & SOW – deliverables
management
Inclusion within RPO / RPO
Alternative contingent
labour resourcing models
Complete enterprise-wide
workforce visibility
Major Milestones
Creation of first contingent
labour programme
1990s
Technology
Expansion
2004 Globalisation
Vendor
Neutral
2008
Today
Extended
Scope
Flexible sourcing models
Source: SIA presentation – Ciett Global Workforce Conference 2012
18. Current and next steps focus
Source: Staffing Industry Analysts European Contingent Buyers Survey 2013
Which of the following are in place in your organisation?
19. Another pressing need - the application
process is broken..
19
40% had an existing
relationship with the
company prior to
applying, either as a
customer, advocate or with
family/friends already at the
company
20% admit to
being an actual
customers of the
organisation they
applied to
74% say they would
share a positive with
their inner circle -
61% would share a
negative one
27% say they would
share a positive CE
on social channels –
16% would share a
negative one
Source: UK CandEs 2012 – www.thecandes.org.
one third of those
surveyed admitted to
receiving no response
at all to an application
20. Talent pooling begins to treats candidates in
a similar fashion to customers
Time is being invested in drawing candidates into talent pools
& puddles, and in nurturing them for potential future
opportunities.
Growth of talent pools being fuelled by internal referral mechanisms.
Theory: as a candidate, once within the talent pools of your
target organisations, you should never have to apply (or be put
forward) for a job again.
21. The Service Provider community
21
Companies who provide payroll, accountancy and administrative
support and advice for the professional freelance workforce.
A number of have also embraced the potential of providing employed
temporary workers – know as Umbrella workers:
Concept accelerated with the implementation of the Agency Worker
Regulations (AWR) in 2011.
Estimated number of „umbrella‟ workers – c.150,000 -200,000.
An industry/opportunity to watch – precedent set in the US for it to morph
into a professional service of high esteem:
US has an established and highly regarded Payrolling and Independent
Contractor Evaluation / Compliance industry.
UK has a dedicated trade association determined to set a benchmark to
enable the industry to evolve in a similar fashion.
A service that, increasingly, both workers and hirers
appear to need.
22. Intermediaries promoting alternative
resourcing models
Barclays – PAYE temps sourced by agencies but directly
engaged since 2009.
PWC‟s STAFFflow scheme:
Running for around 18 months
Used by around 30 NHS Trusts
Removes the requirement to pay the 20% VAT that would have been
payable on the salaries of temporary agency staff by allowing trusts to
employ them directly.
STAFFlow margin achieved out of saving (Source: Recruiter
Magazine)
23. On-line working
23
“We‟ve passed into a new economic
era, presenting businesses and individuals
with mounting challenges. Work marketplaces
based on social platforms – „placeforms’ – fill a
new societal need.”
Stowe Boyd
24. The potential for on-line working in the UK
has many drivers
24
Underemployment:
“People in work wanting more work increased by 1million since 2008” -
ONS
Over 3 million people - 1 in 10 workers - want/need more work
One of the key drivers for the introduction for Real Time Information
(RTI) is to capture multiple income streams
0
2
4
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
Number of
underemployed
workers in Britain (m)
Want more
hours in current
job (2.33m)
Want
replcement job
with more hours
(0.46m)
Want an
additional job
(0.27m)76%
9%
15%
25. Interest in crowd labour / on-line work is rising
25
Crowd workers
Nearly 60% of all crowd workers live in North America and Europe.
Almost 50% have a bachelor degree.
The number of crowd workers is growing in excess of 100% a year.
Crowd members work at least once a month; about half work as often as
once a day.
Nearly 77% of all workers have a primary job.
Crowd Providers
$1bn industry in 2012 (Staffing Industry Analysts)
Forecast to be $1.6bn in 2013
Projected to be a $5bn industry by 2018
Elance – UK is #2 in volume of task posted and #5 in number of crowd
workers
Source: Massolution 2012
26. UK – a top 10 country for both hiring
and working
26
28. The top 10 on-line jobs UK
businesses hire for
28
Q2 2013 Top Categories (by dollars spent):
1. Web programming
2. Web design
3. SEO (search engine optimization)
4. Mobile apps
5. Desktop applications
6. Graphic design
7. Blog & article writing
8. Ecommerce
9. Web research
10. Data Entry
UK businesses have
posted 344K+ jobs to
date
29. What skills are driving growth of
online hiring by UK clients?
29
Fastest-Growing Categories (based on 2-yr CAGR of gross
services)
1. Technical support
2. Accounting
3. Email response handling
4. Game development
5. PR - Public relations
6. Advertising
7. Presentations
8. Copywriting
9. Web research
10. Illustration
30. Top skills of UK freelancers
30
Q2 2013 Top Categories:
(by dollars earned)
1. Web programming
2. Website content
3. Blog & article writing
4. Translation
5. Technical support
6. Mobile apps
7. Web design
8. Copywriting
9. Graphic design
10. Software Project
Management
Fastest-Growing
Categories: (2yr CGGR of
Gross Services)
1. Sales & lead generation
2. Copywriting
3. Software QA
4. Mobile apps
5. SEM - Search engine
marketing
6. Translation
7. Technical writing
8. DBA - Database
administration
9. Business plans & marketing
strategy
10. Website content
31. Rising volumes of flexible hours
engagement models
31
Means of
Engagement
specified
2011 2012 Increase
2011/2012
H1 2013 (to
end June)
Pro-rata
increase
2012/2013
Flexible Working 128,881 190,013 47% 112,628 19%
Flexible Hours 43,892 105,784 141% 72,628 37%
Hours to Suit 10,952 20,491 87% 13,848 35%
Hours as Required 3,804 5,996 58% 3,732 24%
Variable Hours 953 2,361 148% 954 (17%)
Zero Hours contract 942 1,691 80% 1,017 20%
Total number of
opportunities
offering flexible
working patterns
189,424 326,336 72% 204,807 26%
Set into context of all the job vacancy types advertised, as captured by
the ONS, (Av. 519k during H1 2013), opportunities offering flexible
working hours patterns constitute 6.6% of the work currently being
32. Back to the Starting Place – Charles
Handy’s Shamrock
32
Implications for the organisation.
Implications for the individual.
Implications for policy makers:
“This rethinking of organisations will force the rethinking of
retirement, unemployment
insurance, healthcare, employment taxes and social
security, to name but a few. Organisations will step out of
the role of providing these benefits to permanent employees
and something needs to step into the void.
“..how we might need to adapt in order to not just
survive, but thrive.”
33. The implications of further workforce
fragmentation for the recruitment industry
33
The use of intermediaries will rise:
To help realise the potential of such fragmentation.
To manage compliance.
The range of commercial models will diversify:
Introductory fee models for temporary labour – rather than
on-going margin.
Payment upon outcomes – shift towards „Statement of
Work‟, apprenticeships, on-line working, etc..
Compliance has an increasing and, potentially, standalone
value
34. The implications of further workforce
fragmentation for the recruitment industry
34
Legacy processes will need to be modified to enable
engagement – throughout the entire lifecycle - with a
diversifying range of worker types:
How/where you raise awareness
How you address the levels of transparency demanded by
each group
How you hold a seamless dialogue across their chosen
range of media
The levels of personal contact versus automated
communications that suit the profile of each worker
community
How you business accommodates a shift towards payment
upon outcomes
35. The implications of further workforce
fragmentation for the recruitment industry
35
The opportunities – beyond transactional
temporary, contract, interim and permanent
recruitment – are considerable. They could also,
potentially, be more lucrative.
