- Tags : HR & Staffing | Contingent Workforce Management Services | Price trend | Price forecast | Procurement research | Category market forecast
Recent Price Trend - Contingent Workforce Management Services
In the three years to 2016, the price of contingent workforce management services has been rising an estimated 0.5 percentage points to reach 10.2% of contingent workforce spend. Growing demand has been the primary cause of price growth, which has made it more difficult for buyers to secure favorable contract terms. Fortunately, stable trends in input costs and most demand drivers has resulted in a low level of price volatility, which has helped ensure that buyers can accurately budget for these services.
Demand for contingent workforce management services generally fluctuates in line with the size of the contingent workforce. The recession brought about broad change to the labor market; unemployment rose, and many of the remaining jobs became temporary positions because temporary labor poses a lower risk to employers than permanent labor. Furthermore, by using temporary labor, businesses are able to scale their workforce in line with demand without the hassle and expense of having to regularly hire or downsize permanent positions. Although economic conditions have been improving from 2013 to 2016, businesses have continued to hire temporary employees to improve their operational efficiency. As a result, the number of temporary employees has maintained considerable growth during the period. As the contingent workforce has expanded, businesses have faced more regulatory compliance and vendor management concerns, leading them to increasingly demand for contingent workforce management services. As a result, suppliers have had the ability to raise prices without sacrificing profit.
Despite growing demand, buyers have benefited from providers' falling wage costs. Because wages represent the largest cost to suppliers, declining wages have helped them maintain control of their internal costs and slow price growth. Nevertheless, buyers should consider establishing long-term contracts with vendors soon to lock in prices before they grow further.
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