Future Workforce Report 2022: Leveraging Independent Talent as a Key Workforce Strategy

Recent government data shows that the U.S. job market remains remarkably strong, with unemployment hovering around a 50-year low. However, as companies look to hire highly skilled workers quickly, they're finding that the number of available job seekers continues to decline while the number of Americans who quit their jobs is at a 20-year high.¹ As a result, sourcing talent remains a persistent challenge for most businesses. In order to bridge the talent gap, many companies have turned to skilled independent talent as a core workforce strategy.  

Upwork’s Future Workforce Report, a representative survey of 1,000 U.S. hiring managers, reveals how businesses have adapted their hiring and workplace practices to meet their staffing needs over the past two-and-a-half years. This includes increasingly relying on skilled independent talent. The data also explores how hiring managers are preparing to withstand continued talent shortages.

Key findings:

• A majority of businesses are hiring but struggling to source talent: Nearly 70% of hiring managers (69%) say they anticipate staffing up over the next six months. At the same time, 60% cite difficulties finding quality talent to fill open positions.

• Freelancers help businesses solve the talent shortage: Nearly 80% of hiring managers who engage skilled freelancers say they are confident (78%) in their ability to find the talent they need, compared to just 63% of those who don’t engage freelancers.

• Independent talent provides access to specialized skills: Of those who hire freelancers, 85% say that working with independent professionals allows them to access talent with specialized skills or expertise.

• Independent talent unlocks innovation: 79% of businesses agree that working with independent talent enables their business to be more innovative.

• Organizations that work with independent talent are more confident about withstanding turmoil: Among those hiring managers who use freelancers, 84% say they are confident in their company’s ability to respond to disruption, compared to 69% of those who do not use freelancers.

• Use of skilled independent professionals poised to accelerate: Nearly 60% of hiring managers who engage independent talent say they plan to increasingly rely on freelancers over the next six months (58%) and over the next two years (66%).

• Most in-demand roles: The top job categories hiring managers need to fill most urgently are Accounting (33%), IT & Networking (30%), and Operations (29%). Over the next six months, 52% say Customer Support will be a top position they seek to fill.

• Toughest roles to hire: Respondents report the roles that will be hardest to hire for are in Data Science and Analytics (60%), followed by Architecture and Engineering (58%), and IT & Networking (58%).

Businesses are looking to hire

Through the past quarter, stories of corporate layoffs and hiring freezes have become more common. However, these stories may be more of an exception than the rule when it comes to hiring today. According to our survey, 69% of all hiring managers say that they anticipate hiring in the next six months.

When asked about the categories of work that they are looking to hire for in the next six months, Operations (55%), IT & Networking (52%), and Customer Support (52%) roles were the most commonly ranked. However, hiring managers ranked Accounting (33%), IT & Networking (30%), and Operations (29%) as the top job categories that they most urgently needed.

Although hiring is a top priority for many managers, recruiting highly skilled full-time talent quickly may prove to be difficult.

But businesses are still feeling the crunch from The Great Resignation

Although resignations have slowed slightly from the peak, nearly half (43%) of businesses say that The Great Resignation has negatively impacted their organization.²

The most frequently cited way that The Great Resignation has negatively impacted organizations is difficulties in finding talent quickly (37%).

What’s more, the severity of the impact varied based on the level of remote work flexibility. Remote-first organizations were least often negatively impacted (31% negatively impacted), especially compared to remote by day (55% negatively impacted) or on-site-first organizations (49% negatively impacted).

To attempt to minimize the ongoing impact of The Great Resignation, businesses are leveraging different tactics. The most commonly cited steps included increased schedule flexibility, increased compensation, and increased remote work options.

Even still, businesses are struggling to find talent

The hunt for talent remains fierce for businesses. Companies are experiencing the compound impact of those quitting as part of The Great Resignation and others who are changing roles taking advantage of the high volume of job openings in the U.S.³ As a result, businesses are scrambling to fill roles while simultaneously trying to rehire those who are leaving. When asked about their ability to hire, 60% said that it is currently hard to find quality talent to fill positions.

Although recruitment is challenging across the board, hiring managers also noted that they anticipate hiring in some categories of work to be particularly difficult. Hiring managers think data science and analytics roles will be the hardest to hire for (60%), followed by architecture and engineering (58% say it will be hard), and IT & networking (58%).

This struggle to find talent may not let up any time soon, but some forward-thinking companies are using a different playbook for success: freelance talent.

Many are leveraging independent talent as part of their workforce strategy

Over the past year-and-a-half, Upwork has seen signs of remote work taking effect in the use of independent talent. Because remote work enables employees to work together at a distance, a positive spillover effect of remote work is that it makes collaboration easier in general. As our 2021 report found, remote work had an overall positive impact on businesses’ willingness to use independent talent.

With a new set of challenges in 2022, including hiring and economic uncertainty, we see that independent talent has become an even more critical part of organizations. A majority (56%) of hiring managers that engage independent talent say they have increased utilization of independent talent over the past 12 months. And there is no sign of that trend letting up: 58% plan to increase utilization of independent talent over the next six months, as well as over the next two years (66%).

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Independent talent are filling skills gaps and increasing organizational responsiveness

We also asked hiring managers about how independent talent impacted their organization. We found that independent talent are helping businesses access talent and work more efficiently and effectively.

Of those who hire independent talent, 85% say that working with independent talent allows them to access specialized skills or expertise. Seventy-nine percent agree that working with independent talent has enabled their business to be more innovative.

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When viewed as a part of their overall talent strategy, utilizing independent talent also helps alleviate much of the hiring strain. When comparing companies that engage independent talent to those that do not, we find that hiring managers that engage independent talent agree that it is easier to source talent than it used to be (56%). Meanwhile, only 36% of hiring managers that don’t engage independent talent agree it is easier to hire. Working with independent talent gives hiring managers more confidence in their ability to find the talent they need. In fact, 78% of those that engage independent talent say they are confident in their ability to find the talent they need, versus 63% that don’t engage independent talent.

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Conclusions

Businesses faced turbulent times over the past few years, but those that adapted their talent strategy to include remote work and independent talent will be better equipped to face uncertainty in the future. When asked about how confident they are in their company’s ability to respond to a disruption, 84% of those who use independent talent say they are confident compared to just 69% who do not use independent talent.

An effective talent strategy that can scale and contract as needed is key for businesses to navigate uncertainty.

Methodology

The report was conducted by independent research firm ClearlyRated. This is the seventh year the survey has been conducted. This report uses survey data to understand hiring trends and sentiments among hiring managers. More than 1,000 U.S. hiring managers were surveyed through a third-party, independent online sample between April 25, 2022 through May 10, 2022.

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1. https://fred.stlouisfed.org/series/JTSQUR

2. According to BLS Quit Levels, https://www.bls.gov/news.release/jolts.t04.htm

3. Job openings were at 11.3 million as of May

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