Bringing on talent as your business grows is a big step, and depending on your needs, there are several options to consider. According to CareerBuilder's 2017 midyear hiring forecast, 40 percent of employers said they planned to hire regular full-time employees this year, while half of all employers anticipate adding temporary or contract workers. So how do you determine the best hiring solution for your company?
Contract workers are ideal for boosting talent for short-term projects that require a very specific set of skills. The pros are simplicity and flexibility. Hiring contract workers is a less complicated and less expensive process than hiring an employee. With freelancers, it's just a matter of drawing up a contract, and they can begin immediately—no need for lengthy onboarding, and because they are not on staff, you don't have to provide a benefits package. Other than filling out a 1099-MISC form at the end of the year that specifies how much you paid that person, you also don't have to worry about withholding or paying FICA taxes. Because contractors don't require the same investment of time and money as hired employees, there is a lot less pressure should you decide to cut ties or work with someone else.
The cons are less control and potential IRS issues. Unlike your own employees, contract workers are self-employed, therefore you don't have the authority to dictate work hours. You also cannot expect to have 9-5 access to them since they likely have other clients. Other than project specifications and a deadline, you don't have much authority.
If you hire freelancers and become the subject of an audit from the IRS or the Department of Labor, you'll have to be prepared to prove they were not, in fact, your employees. Do yourself a favor and review the IRS guidelines on how to determine whether the individuals providing services are employees or independent contractors.
In-office hires work well for companies that need someone to provide long-term value and wear several hats. The pros include engagement, longevity and onsite management. Employees who are part of your team become invested in the success of the company. Unlike contractors who have their own business, your employee's success is directly related to the success of the business overall. Plus, by providing a competitive salary and growth opportunities, you can retain your best talent.
People who work for your company are essentially subject to your workplace rules. You set the work hours, the training programs, the productivity expectations, and can require that the person only work for you.
The con is risk. Recruiting and onboarding a new employee is a big time and money investment, and if it doesn't work out, you have to start from scratch. Plus, a hire gone badly can negatively affect the morale of other staffers.
Remote employees add talent without using up office real estate. The pros are saving money, boosting productivity and hiring from a larger talent pool. According to a recent survey, nearly six out of 10 employers say allowing some staffers to telecommute provides cost savings. Telecommuters at Compaq, Best Buy, British Telecom and Dow Chemical have all shown to be as much as 45 percent more productive. Without the distractions that sometimes happen in an office, focused remote workers can get more done. When you're not limited by geography, you can stretch your talent search to find employees who more closely match the roles you need to fill.
The cons include employees being tougher to supervise and feeling disconnected. Culture is such an important part of business success, and that can be difficult to cultivate for the portion of your workforce who works remotely. To help staffers feel a sense of camaraderie, you'll have to be more proactive about planning in-person functions and meetings. Despite the productivity potential, if your remote workers aren't self-motivated, it can be hard to manage them from afar. Plus, certain types of jobs might benefit from face-to-face brainstorming and collaboration.
Deciding which type of hiring solution is right for you comes down to your needs—if it's a short- or long-term project, your physical office space and your budget. The good news is that you can decide on a case-by-case basis, and build a hybrid workforce that is optimized for efficiency.