What is a contingent workforce? Definition and examples

Not everyone who works for a company is an employee. The contingent workforce is the rest: the contractors, freelancers, and agency workers brought in for a scope or a season. For many enterprises it is a large and growing share of the total.

Key facts

The contingent workforce is the non-permanent portion of a company's labor: contractors, freelancers, temporary staff, and agency workers.
These workers are engaged for a defined scope or period rather than as employees.
"Contingent workforce" is the procurement-facing term; "contractors" usually reads better in everyday copy.

Contents

What is a contingent workforce?
Who is in the contingent workforce
Contingent workforce vs permanent employees
Why the contingent workforce is growing
Frequently asked questions
Managing your contingent workforce

What is a contingent workforce?

The contingent workforce is the non-permanent portion of a company's labor: contractors, freelancers, temporary staff, and agency workers engaged for a defined scope or period rather than as employees. They do real work for the company without being on its permanent headcount.

Who is in the contingent workforce

Independent contractors and freelancers, engaged directly for a project.
Agency workers, supplied through a staffing agency.
Temporary workers, brought in for a season or a surge.
Consultants and SOW workers, engaged for a defined outcome.

Contingent workforce vs permanent employees

Permanent employees are on payroll with benefits and an open-ended relationship. Contingent workers are engaged for defined work, handle their own arrangements more often, and move on when the work ends. The external workforce is the broader umbrella that includes all of them.

Why the contingent workforce is growing

Companies use contingent workers for flexibility, specialist skills, and speed. As that share grows, so does the need to see and control it in one place rather than team by team.

Key takeaway: The contingent workforce is often the part of the labor base with the least visibility and the most compliance risk.

Best practice: Manage it as one program. Worksome runs sourcing, classification, contracts, pay, and spend control for the whole contingent workforce in one place.

Frequently asked questions about the contingent workforce

What is the difference between contingent workforce and external workforce? Contingent workforce is the procurement-facing term for non-permanent workers. External workforce is the broader umbrella for everyone who works for a company without being a permanent employee.

Is a contractor part of the contingent workforce? Yes. Independent contractors and freelancers are a core part of it.

Why do companies use a contingent workforce? For flexibility, specialist skills, and faster access to talent than permanent hiring allows.

Managing your contingent workforce

A contingent workforce is only an asset if you can see and control it. That is what contingent workforce management is for, and what Worksome runs end to end.