APAC companies adopt contingent workforce to overcome talent crunch

Photo by Andrew Neel

PERSOLKELLY has released a business survey report  that highlights how companies are turning increasingly to a Contingent Workforce strategy to overcome headcount shortages.

Businesses impacted by COVID-19, technology’s rapid growth and economic uncertainty are rethinking traditional recruitment approaches to stay competitive.

The survey highlights how a Contingent Workforce is already an essential part of workforce strategies in Asia Pacific and the trend is accelerating, with companies planning to increase their usage over the next two years.

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A Contingent Workforce includes short-term and fixed-term contractual employees, freelancers and independent contractors outsourced to agencies.

The most common reason for adopting a Contingent Workforce is that it offers flexibility to workforce planning. The second top reason is to help fill specialised roles to ensure no disruption to operations.                                 

The survey illuminates a changing mindset, with the majority of companies likely to offer contingent workers the same or better rewards as permanent staff.

Key findings:

  • 58% of respondents use a Contingent Workforce when experiencing a headcount shortage. Sectors most in favour of using a Contingent Workforce are IT/Hi-Tech, Healthcare/Pharmaceutical, FMCG, Logistics/Supply Chain, Financial Institutions/Banking, Professional Services/Consultancy, Manufacturing and Government/Statutory Agency.
  • The highest adoption of a Contingent Workforce is in Indonesia (67%), Hong Kong (66%), Malaysia (64%) and Singapore (60%).
  • About 25% of companies already using a Contingent Workforce will increase their usage over the next two years.
  • 74% of companies are likely to reward a Contingent Workforce the same or better than full-time staff.
  • 48% of respondents engage recruitment agencies for their headcount needs and strategies.

Good staff benefits key to Malaysia’s growing contingent workforce

The same report also highlighted that one of Malaysia’s top headcount strategies is to offer good employee benefits, including Training and Upskilling.

64% of Malaysian companies surveyed engage a Contingent Workforce as a flexible staffing solution to Malaysia’s scalable labour market, and the figure is expected to grow by 15% in the next two years.

Key findings in Malaysia:

  • 42% of Malaysian companies offer incentives or hikes in remuneration/benefits to attract/retain talents
  • 58% of Malaysian companies provide Training and Upskilling as a strategy to fill gaps in workforce

“While economic uncertainty remains, the post-pandemic rebound presents businesses with a wave of opportunities,” said Elvin Tan, Regional Director – Head of Operations APAC, PERSOLKELLY. 

“Given the talent shortage and fluctuations in supply and demand, growth-hungry companies must embrace fresh hiring approaches to stay competitive. A well-implemented Contingent Workforce strategy brings multiple benefits in this volatile landscape.”