It’s hard to believe 2024 is almost half over already. As we approach the midpoint of 2024, the labor market continues to evolve, especially in the contingent workforce sector. This dynamic space is constantly influenced by new trends and regulatory changes that can impact your business operations. In this blog, we'll dive into some of the key developments affecting the contingent labor landscape, from the integration of artificial intelligence to the latest labor regulations and the ongoing debate about remote work.
Here’s what you need to know to stay ahead in the rapidly changing world of contingent labor:
1. AI adoption is continuing, but it’s complicated.
Widespread adoption of AI is progressing but finding people who understand its intricacies is a challenge.[1] there are some solutions for this but they can take time. Things like upskilling current workers with AI knowledge and additional certifications could solve this problem but this could also take away from their current priorities. The integration of AI is going to continue being a problem of resource management until the knowledge and the labor market catches up with the markets speed of adoption.
It's kind of like starting a lemonade stand, but not knowing how to make lemonade and the people that do know how to make lemonade are making lemonade for other people. Those people could teach you how to make lemonade but it's going to take some time for their ability to open.
However, as more people learn to make lemonade there will be more people to teach others how to make lemonade and the market will adjust.
2. The Department of Labor issued a rule on Independent Contractors and how their status is determined.[2]
On January 10, 2024, the United States Department of Labor (DOL) issued its final rule revising the department’s guidance on how to determine whether a worker is classified as an employee or an independent contractor (IC) under the Fair Labor Standards Act (FLSA). The rule focuses on the economic realities test developed by various courts, rescinding the previous two factor rule. On March 11, 2024, the new rule outlined six factors to consider when determining whether to classify a worker as an Employee or Independent Contractor.
If you are a company who has taken a conservative approach to how that you use independent contractors, this may not affect you as much. However, if you haven't fully understood the qualifications of your IC's and what it takes for them to be legally compliant with their relationship with your business you may want to dive a little deeper into your workforce compliance.
We would encourage you to investigate an IC compliance program or reach out to your company's legal department. either way, find an expert.
3. The remote vs. in-office debate continues.
Fully remote? Fully in-office? Hybrid? Companies large and small are continuing to ask workers to come into the office more. Companies, including Google, Amazon, Meta, and Apple, have implemented return-to-office mandates requiring employees to be in the office at least three days per week as of January 2024. Also, 16 federal agencies, including the U.S. Department of Justice, the State Department, and the Federal Aviation Administration, have announced return-to-office mandates.[3][4][5]
How is your company handling RTO? With more people wanting to work remote, you may run into some talent accessibility issues if you have a firm stance on being in-office. Some things are better done in person, but it seems that a lot of individual contributor work can continue to be done remotely. If you want people in the office, give them a good reason to be there.
The contingent labor space is ever changing and we will be keeping close tabs on what is going on the next few months to bring you another edition of this blog in Q3 when the weather is warmer and sun is shining. We encourage you to check out other PG content and talk to us more about what is happening in your contingent labor program! Click the link below to chat with us!
sources
[1] https://www2.staffingindustry.com/site_member/Editorial/Daily-News/CFOs-more-upbeat-on-US-economy-generative-AI-talent-is-concern-68725
[2] https://450029.hubspotpreview-na1.com/_hcms/preview/email/160256574383?portalId=450029&preview_key=tENRUQjd&_preview=true&from_buffer=false&cacheBust=0&hsPreviewerApp=email
[3] https://www.statista.com/statistics/1416837/tech-companies-return-to-office-mandates-globally/
[4] https://www.hrdive.com/news/mandatory-return-to-office-400k-federal-workers-jan-2024/701619/
[5] https://journalrecord.com/2023/12/return-to-office-gains-momentum-as-workforce-evolves/
Ejay Oravecz
Jen Pasquier
Leave a comment