Predicting what the economy is going to do during 2009 is tricky, to say the least.  For example, at the end of last year, many financial experts and forecasters believed that the economy would begin to turn around sometime during the second quarter.  Now, those same experts - some of who are officials on the Federal Reserve Board - are of the opinion that the recession will last throughout all of 2009.

Regardless of when the economy starts to rebound, whether it’s six months or 12 months from now, there are still things that all companies need to address.  Some companies feel that it’s “business as usual” when it comes to the following:

1. Reducing employment costs
2. Increasing staffing flexibility 
3. Utilizing top talent

As you well know, just because the economy is in a recession doesn’t mean that your production goals have been lessened or that expectations have been lowered.  Deadlines still need to be met and projects still need to be completed.  Hiring candidates on a contract basis can help you to conduct business as usual . . . and much more.

No one has a magic genie
Even though you don’t have a magic genie to grant you three economic wishes, you can still have a “Wish List.”  One wish involves a reduction in employment costs, which is a direct result of the challenges posed by the recession.  There are numerous ways in which the utilization of contractors can reduce these costs.  The major ones are identified below:

• No employee benefit costs for medical, dental, vision, life insurance, and 401(k)
• No added expense for holidays, vacations, sick time, etc.
• No workers’ compensation claims or premium increases
• No unemployment claims and associated costs when employees are terminated
• No administrative costs for hiring and processing new employment paperwork

Next on the “Wish List” is staffing flexibility, which can be in short supply during tough times.  Flexibility is crucial for any company seeking to maximize its resources and productivity.  Below are areas in which contracting can provide valuable flexibility in the face of an inflexible economy:

• Match staffing levels to your workload and project goals
• Quick hiring process vs. a lengthy direct-hire placement cycle
• Acquire needed resources through a standard purchase order versus a capital budget

No matter what the economic conditions, hiring top talent is crucial and is always on the “Wish List.”  That’s what makes the prospect of a temp-to-direct contract so appealing.

• Candidates can be brought on board until the budget opens up
• Opportunity to truly evaluate the candidates’ skills and corporate “match”
• Option to easily terminate the contract if it’s not a “match”

Hidden benefits
One of the benefits tied to contracting that many companies don’t recognize is the ability to avoid the bad press associated with layoffs.  In a world where employees blog and “twitter” about their employment experiences, it’s almost impossible to run damage control.  Take, for instance, the example of Yahoo.

Yahoo cut 1,500 employees from its workforce on December 10, 2008.  The only reason their downsizing efforts became public knowledge was that employees twittered about the looming deadline.  As a result, Yahoo’s layoffs became national news.  Management had effectively lost its ability to control information, especially how the company was perceived in the workplace.  As a result, it may be more difficult for Yahoo to woo top talent in the future.  Retaining workers on a contract basis (or hiring them on contract in the first place) is a great way to avoid layoffs and the bad press associated with it.

Regardless of the economy . . . We can help YOU!
Working with a recruiting firm that can provide both contract and direct-hire candidates is a win-win situation for companies.  You can hire contractors during a down economy and full-time employees during a good one.  Best of all, you don’t have to search for different recruiters to meet your hiring needs.  By relying on a sole-source provider, you can reduce employment costs, acquire top talent, and enjoy staffing flexibility, regardless of economic conditions.

While there’s a great deal of uncertainty about the economy and what will happen during the rest of this year, contracting can help eliminate some of that uncertainty.  If you haven’t done so already, consider utilizing contract workers as part of your workforce planning goals and take advantage of a sole-source provider to meet your hiring needs.  It could be the key to ensuring a productive—and profitable—2009.