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UK organisations increasingly relying on freelancers

Hilde Haems
gig economy

Over a quarter (26.3 percent) of UK organisations rely on freelancers to complete core business tasks. But in more than half of UK organisations (50.3 percent), HR departments are being cut out of the hiring process. Contributor Hilde Haems, Chief HR Officer – SD Worx Group.

These results come from the latest survey conducted across five European countries by the payroll & HR services provider SD Worx and Antwerp Management School. The research uncovered how organisations are using freelancers, in which departments, for how long and what kind of tasks they are hired. The survey found that businesses employ freelance workers especially for highly specialised tasks, with just under half (44.9 percent) of UK organisations bringing independent workers in to capitalise on their specialist skills.

Organisations understand the need to be agile, but are struggling to achieve this with their internal workforce alone, with only 36 percent of European organisations reporting that the majority of employees have skills that can be used outside of their current job. The research shows that across Europe organisations of all sizes are hiring self-employed workers for a mixture of peripheral and core business tasks. The size of the business makes a significant difference as it is most common for larger companies of 500-999 employees to regularly  use independents for core tasks with 41.5 percent of European organisations claiming to do so; almost twice as much as businesses with fewer than 20 employees (21.6 percent). Germany is most likely to use independent workers for core tasks (31.4 percent), whilst companies in Belgium are least likely to (18.8 percent).

Interestingly the number of businesses using self-employed workers for peripheral tasks is less than core tasks, with only 21 percent of UK businesses doing so. This was more common in larger European organisations of 500-999 employees where nearly half (43.4 percent) brought in freelancers to work on peripheral tasks.

Under half (44.9 percent) of UK businesses frequently use independent workers for short-term assignments, with firms in France doing so most often (47.4 percent) and companies in Belgium doing so the least (33.8 percent). Larger organisations are more likely to frequently use independents for short-term assignments. Over half (55.7 percent) of European businesses with more than 1000 employees use freelancers frequently for short-term projects, compared to 32 percent of firms with 20-49 employees.

Fewer European businesses (29.3 percent) use independent workers for long-term assignments. Firms in Germany do so the most (34.6 percent), with Belgium closing the list at an adoption rate of 20 percent.

Within European organisations the Executive Board holds the most influence (34.1 percent) on making the decision to recruit independent workers. Surprisingly line managers (16.2 percent) and HR departments (9.7 percent) in the region hold the least influence, indicating the need to bring them in to every stage of the hiring process. This is highlighted further by the fact that less than half (45.9 percent) of European respondents always inform the HR team when a decision is made to bring in self-employed workers – indicating the HR team is left out of the loop in the majority of decisions.

“European businesses understand the benefits that self-employed workers provide, especially in terms of their specialist skill sets, and are involving them at the very heart of the organisations,” comments Hilde Haems, Chief HR Officer at SD Worx Group. “As organisations are increasingly evolving towards more flexibility in the workforce, HR departments will need to have a constant and accurate view on the skills, unique talents and the knowledge of all workers, both long and short-term, within their organisations. Tools for workforce planning can help with this, for the benefit of the employee and the business alike.”

On a European level IT departments are the most likely to employ freelancers (36 percent). IT teams in the UK are hiring the most self-employed workers (41 percent), compared to Germany (37 percent), France (34 percent), The Netherlands (33 percent) and Belgium (31 percent). Other departments also see the benefit of independent workers, with production (33 percent), sales (28 percent) and marketing (27 percent) frequently hiring freelancers. Of all European business departments HR (15 percent) is least likely to hire independents.

“There is a correlation between employee turnover and the use of freelancers. Organisations with a higher turnover ratio are more frequently working with freelancers than those with a lower turnover rate. The high turnover rate might urge organisations to quickly respond to the need to people when a person leaves the organisation and that working with freelancers allows to fill in this need more easily than when starting a hiring process. However, it might also be the other way around, i.e.,  when organisations are working more with freelancers this might signal to internal employees a lack of career prospects for them, making them more inclined to search for other career opportunities outside the organisation. It is important for organisations to understand if and how the use of freelancers might affect the commitment and engagement of their payroll employees,” Professor Ans De Vos from Antwerp Management School concludes.

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