How to manage contingent labor, using strong data

There’s no doubt about it, contingent labor has become an essential part of a strong workforce strategy. From adapting to seasonal peaks to meeting unexpected demands, contingent workers provide the flexibility businesses need to stay competitive. However, managing this workforce effectively requires more than simply filling shifts — it demands a data-driven approach to maximize productivity, control costs, and keep your workforce engaged.

Here’s how businesses can use meaningful data to manage contingent labor positively and release its full potential.

1. Gain complete visibility across your workforce

The key to effective contingent labor management is visibility. Without a clear understanding of where your resources are being allocated, it’s impossible to make informed decisions.

Visibility begins with consolidating data into a single platform, such as a Vendor Management System (VMS). These tools allow businesses to track:

• Labor spend: See how much is being spent across roles, locations, and agencies.
• Fulfillment rates: Identify whether shifts are being filled and pinpoint gaps.
• Performance metrics: Assess the quality of workers and agency reliability.

By having a bird’s-eye view of contingent operations, organizations can identify what’s not working so well and where there are opportunities for improvement, optimize workforce efficiency, and ensure resources are allocated where they’re needed most.

2. Use data to align staffing with demand

Matching staffing levels to business needs is vital when it comes to optimizing productivity. Overstaffing results in unnecessary costs, while understaffing leads to burnout, reduced morale, high turnover, and missed opportunities.

Historical data and predictive analytics can provide insights into:

• Demand trends: Understand seasonal peaks, busy periods, and low-demand times to optimize staffing levels.
• Shift performance: Identify which shifts are overstaffed or understaffed to adjust schedules accordingly.
• Role requirements: Determine which positions are hardest to fill and allocate resources proactively.

With this information, businesses can build schedules that reflect real demand, improving workforce efficiency, and improving overall productivity.

3. Monitor and improve worker performance

Data doesn’t just help manage costs; it also supports the development of a high-performing contingent workforce. Regularly reviewing performance metrics, such as attendance, completion rates, and worker feedback, ensures consistent quality.

Some key strategies you can put in place include:

• Setting clear expectations: Use data to establish benchmarks for worker performance and communicate these standards to agencies and staff.
• Rewarding top performers: Identify high-performing workers and offer them additional shifts or opportunities, improving retention and engagement.
• Addressing issues promptly: Quickly flag and resolve problems, such as frequent absenteeism or poor feedback, to maintain productivity.

By bringing in software to track employee productivity, businesses can accurately monitor worker performance and ensure workforce efficiency remains high.

On the subject of rewarding top performers, Indeed Flex incentivizes workers to be at their very best, by offering a tiered system of rewards, as they move from bronze all the way up to platinum level.

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4. Control costs without compromising quality

Effective cost management is the linchpin of contingent workforce optimization. Spiralling costs often result from a lack of oversight or reliance on outdated processes.

Data-driven strategies can help control costs by:

• Benchmarking rates: Compare pay rates to market standards and negotiate fair terms with agencies.
• Tracking agency spend: Monitor how much is being spent on each agency to identify unnecessary expenses.
• Reducing overtime: Analyze patterns in overtime usage and implement measures to better manage shift coverage.

By combining cost control with quality assurance, businesses can ensure their contingent workforce remains both effective and financially sustainable.

5. Prioritize workforce satisfaction and engagement

A motivated, engaged workforce is key to achieving high productivity and hitting all goals – both company and individual. Contingent workers often value flexibility, transparency, and clear communication, as well as recognition for their efforts.

Data can play a pivotal role in creating a positive experience for workers by:

• Offering preferred shifts: Use data to match workers with shifts that align with their preferences, such as availability and location, improving satisfaction and reducing turnover.
• Providing transparency: Share information about available opportunities, pay rates, and expectations, to build trust.
• Gathering feedback: Regularly ask for input from workers, to understand their needs and make improvements.
• Reward and recognition: Offer incentives to contingent staff for top performance and regularly recognize their achievements among their peers.

When workers feel valued and engaged, they’re more likely to perform at their very best, and workforce efficiency improves, leading to greater success for your organization.

6. Use technology for real-time decision-making

Technology has made a world of difference when it comes to contingent labor management. Real-time data allows businesses to respond quickly to changing demands and make decisions to ensure maximum productivity.

Platforms like Flex Plus integrate workforce data into a single system, enabling businesses to:

• Adapt schedules on the hop: Adjust staffing levels in real time to meet unexpected surges or dips in demand.
• Automate workflows: Streamline processes like onboarding, shift allocation, and compliance tracking.
• Monitor performance continuously: Access real-time insights into workforce effectiveness, using software to track employee productivity, ensuring all staff remain on track.

The future of contingent labor management

Managing contingent labor positively requires a mindset shift. It’s no longer enough to simply react to staffing needs — businesses need to be ready to get the most out of their workforce using meaningful data.

By increasing visibility, aligning staffing with demand, monitoring performance, controlling costs, and prioritizing worker engagement, organisations can create a contingent labor management strategy that pushes them forwards to reach – and even surpass – business goals.

Find out how making full use of real-time data can truly help your business to grow.