😎 Out: Roles | In: Skills & Freelancers

🙏 RIP Roles 🪦 

The concept of roles is archaic and fundamentally broken. It’s rare to see an accurate job description at the time of hire let alone one that is relevant a few months into a job. Companies’ needs evolve and workers’ interests change. Internal mobility becomes limited as role performance overshadows worker ability.

Enter the skills-first workforce.

A “skills-first” approach focuses on whether someone has the right skills and competencies for a particular role, rather than how the skills have been acquired. The emerging trend of the “new-collar” worker, someone who is highly skilled without a college degree, is a perfect example of a shift in the tide.

The World Economic Forum Putting Skills First 2024 Report does a deep dive into why skills-based hiring will solve the critical skills and talent shortages the economy is facing today. Here are some stats from the report.

• 60% of businesses say that skills gaps in the local labor market hold back the transformation of their business – the top barrier globally. Only 39% of businesses report a positive outlook for talent availability in the next five years, well behind optimistic expectations regarding talent retention and talent development.

• A skill-first culture can help employers and workers adapt to the digital transition. 58% of employees surveyed believe that the skills their job requires will change significantly in the next five years and 66% feel they have a clear sense of how the skills their job requires will change in that time.

• 46% of workers say their formal qualifications are not relevant to their job, yet only 6% of global businesses believe that removing degree requirements would improve talent availability in their organization.

How do we get there?

WEF offers a helpful framework for companies.

Emerging technical solutions are also popping up. TeamLift is a company leveraging AI to validate, catalog, and leverage team skills to enable hiring, internal mobility, and resource planning decisions.

Freelance platforms should be shouting from the rooftops. The “skill-ification” and “project-ification” of the workforce go hand-in-hand. My prediction? Getting companies to adopt skills-based hiring will naturally advance freelance adoption.

🙅 5 Barriers to Freelancer Adoption 🙅 

Talent platforms are touting the challenges of landing big clients only to find their freelance adoption isn’t as far along as they had hoped. While some enterprise departments are hiring freelancers, not all are.

I interviewed leaders of infosec, procurement, operations, legal, HR, and DEI teams at three different Fortune 500 companies to understand their challenges. Here are 5 blockers I’ve discovered.

1. Limited breadth of use cases
   Most people understand that hiring freelancers for short-term discrete-scoped projects makes sense. Most people don’t understand the extent to which hiring freelancers can be better than a full-time employee.
   
   Solution? Train on the scenarios when it’s more beneficial to hire freelancers than employees.
   👀 Be sure you’re following me on LinkedIn, I’ll share 8 reasons on Monday.
   

2. Misconceptions about freelancing

   Most interviewees saw freelancing as a temporary job - something in between other full-time jobs, moonlighting, or for people not skilled enough to get a “real job”. This resulted in a lack of trust and faith in their abilities or commitment to the work.
   
   Solution? Train on the reasons why someone might want to be a freelancer instead of a full-time employee.
   👀 Be sure you’re following me on LinkedIn, I’ll share 9 reasons on Wednesday.
   

3. Inconsistent processes and risk
   A lack of established hiring and procurement processes not only caused delays but risks too. Legal teams worry about classification. Infosec teams worry about devices and access capabilities. The best process will check risk criteria without adding friction to the hiring process. Hiring managers are quick to circumvent arduous processes in favor of getting the talent they need.
   
   Solution? Self-service employment classification tools (like this free one from Oyster) and launching virtual secured environments for remote and contract workers (ex. VDIs).
   

4. Limited cross-functional visibility

   Most teams have little to no idea who is doing work on other teams, regardless of employee classification. The silos cause significant slows in hiring and productivity. If Joe in Marketing hired a designer for a project last quarter, how does Jane in Product know so that she does not need to source, assess, and complete the procurement onboarding of a new designer?
   
   Solution? Internal talent pools with cross-functional visibility. Tools like Bubty are gaining fast traction for talent platforms and internal talent pools to solve visibility and matching

5. Missing contingent workforce data

   Due to the lack of visibility, there’s no tracking of data surrounding performance, costs, or opportunities. No DEI metrics are being tracked or stored for contingent workers. Most accounting and procurement teams have no idea what the total freelancer spend is across the org.
   
   Solution? A similar technology implementation to solve visibility challenges can also aid in tracking and monitoring performance, activity, profiles, and spending.