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New Options for Finding Tech Talent

Vendors are now offering new ways to connect companies with tech talent who may not be looking for full-time assignments. But experts caution there may be downsides to using such novel techniques to source talent.

Wednesday, March 2, 2016
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For HR leaders who feel as if they're banging their heads against the wall in a futile attempt to attract full-time, highly skilled technical talent to their organizations, now may be a great time to consider other options. A growing number of vendors offer services designed to connect companies with sought-after talent that might never consider working full-time for those firms but would happily consider a contract assignment.

"It's an exciting time for these platforms," says Ravin Jesuthasan, managing director and global practice leader for talent management at Willis Towers Watson in Chicago. "They're almost like Hollywood talent agencies for software developers."

Vendors offering services in this area include Guru, Hired.com and 10x Management. Many offer their clients the ability to find pre-screened, sought-after programmers, coders and engineers who want the freedom and flexibility to set their own hours and can command rates that exceed $300 per hour, in some cases. This so-called "agile workforce" can free companies from the burden and expense of taking on full-time employees and allows them to flex their workforces to match business cycles.

PwC is one of the latest to throw its hat into the ring: The huge professional-services firm just announced Talent Exchange, a job platform and app designed to connect sought-after "independent talent" with project opportunities within PwC's 83 U.S. offices. Talent Exchange is the first such offering from a Big Four firm, PwC says, and it already has 2,500 registered candidates.

LinkedIn and Upwork, an online freelance-jobs platform formed by the merger of Elance and oDesk, have also announced new services in this area.

Finding work through online platforms has become the norm for many people. An estimated 10.3 million Americans -- more than the state of Georgia's population -- earned income through web-based platforms such as Uber and Airbnb between 2012 and 2015, according to a new study by the JP Morgan Chase Institute titled Paychecks, Paydays and the Online Platform Economy. That accounts for 6.5 percent of the total U.S. workforce, the study's authors note.

Contingent workers -- including temps, freelancers and independent contractors -- now comprise nearly 35 percent of today's total workforce, according to a survey of 210 small, mid-sized and large businesses by SAP Fieldglass, a vendor-management systems vendor. The survey, conducted in partnership with research firm Ardent Partners, finds that 95 percent of companies consider these non-traditional workers to be a key part of their continued success.

Upwork's new offerings consist of two services aimed at large and mid-size companies, UpWork Pro and UpWork Enterprise.

The new services are "a natural evolution of where we've been," says Mountain View, Calif.-based Upwork's CEO, Stephane Kasriel. Although much of the firm's customer base has traditionally consisted of small businesses, a growing portion is made up of larger firms, including Fortune 100 companies that have acquired many of Upwork's smaller clients, he says.

Upwork Pro is designed to provide clients with a "pre-screened" pool of freelance talent, while Upwork Enterprise is intended to let large companies "build their own private talent pools at scale" while helping them stay in compliance with independent-contractor classification laws, says Kasriel.

"We decide, on behalf of the client and based on the relevant factors, whether the person should be classified as a 1099 worker or a W-2 worker," he says. If Upwork determines the person is an independent contractor, it acts as the staffing provider and indemnifies the client; if the person is determined to be a full-timer, Upwork serves as the employer of record.

The space is becoming increasingly crowded with other vendors offering freelance-related services, including Hired.com, a fast-growing San Francisco-based firm that bills itself as "the jobs marketplace for knowledge workers." Hired.com, which operates an "auction model" for workers who specialize in technology, marketing and sales and are looking for full-time positions, now offers a similar service for those looking for freelance work.

Hired.com uses a screening process in which only a small percentage of jobseekers who apply to be included in its talent pool are allowed in. Once they're in, so-called "talent advocates" work with them on polishing their resumes, navigating the interview process and negotiating their compensation. Companies that hire a full-timer or a freelancer via Hired.com pay it a percentage of the person's compensation, similar to a headhunting firm. 10x Management and Toptal offer similar services.

LinkedIn is currently pilot-testing its new ProFinder service, which is designed to connect freelancers with expertise in fields such as accounting, marketing and writing with potential customers. It's now available in eight major metropolitan areas, including New York, Dallas, San Francisco, Seattle and Chicago.

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"There are a number of differentiating components we feel position LinkedIn ProFinder for success," says Vaibhav Goel, who's overseeing the effort and is a group product manager at Mountain View, Calif.-based LinkedIn. "Our professional graph … shows freelancers and potential clients how they are connected to each other, driving trust in the transaction."

The company points to its 414 million members as a selling point, adding that potential clients can view recommendations from other LinkedIn members.

The online platforms are "bringing transparency to what used to be one of the most opaque parts of the labor market," says Jesuthasan. The trend is being driven by what he says is "a lot of coalescing demand for technical talent -- companies recognize they need world-class programming talent, and these platforms represent a way for them to tap that talent without necessarily having the value proposition, the brand or the compensation structure to go out and try and hire talent that probably wouldn't give them a second look."

These sorts of workers, especially talented coders and programmers, "typically aren't interested in working for a retailer or a bank," he says. So, rather than searching for the proverbial needle in the haystack, these platforms let companies "think of more ways to get work done."

"Why do you need to try hiring full-time programmers in San Francisco when there are equally talented people in the middle of the country?" he says.

There are downsides to this approach to staffing, says Jesuthasan.

"It can get awfully expensive if you're continually just looking to plug gaps -- you're always going to be competing with the spot market," he says.

The ideal approach to taking advantage of these platforms is in knowing how to get the right, sustainable mix of full-time and freelance talent, says Jesuthasan.

"It places a new set of requirements in terms of the business acumen of the decision makers," he says.

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