Staffing has seen some of the major changes for organisations across several industries. Technological advancements, increase in competition, emerging technologies and skills, and remote work culture are some of the factors contributing towards the shift in the hiring and staffing strategies of organisations.
Every organisation prefers having employees with adequate skill set and qualifications to meet their changing needs and business goals. The hiring strategies of organisations need to be aligned with the larger business goals. To that extent, the decision of hiring permanent or temporary staff members is dependent on numerous factors. It is not easy for organisations to decide on these staffing choices.
Both permanent and temporary staff members have their share of pros and cons. Here are a few factors that companies need to take into consideration while deciding on the most suitable option for them.
The specific business needs, skill set requirements, and projects play a critical role in deciding on the hiring of the permanent staff or the temporary staff. For example, an organisation may only require a human resource for one-time involvement in an ongoing project. The organisation may not require these skills in a recurring time frame. In such scenarios, it is better to go for a temporary staff member. On the other hand, the business tasks and activities requiring an extended involvement from an employee are an ideal condition to opt for a permanent employee.
Organisations need to carefully analyse such aspects before initiating the hiring process. The incorrect decisions can take a toll on the organisation’s costs and overall performance. For instance, a cloud company may require skills in mainframe computing for one specific task. The organisation may have clarity on such requirements not emerging in the future. This is an ideal scenario to select the temporary staff members.
Similarly, if the business is prone to constant fluctuations, it is best to prefer temporary staff over permanent employees. The best way is to clearly define the business goals, vision, and mission. Staffing processes then need to map with the organisation’s objectives and priorities.
Staffing decisions and the hiring time frame need to go hand in hand. Organisations often face situations wherein they need to fill in a certain position on an urgent/immediate basis. The companies can fill in such positions with a temporary staff member to keep the business running and address the immediate needs. In other situations, companies may need to hire additional staff to address the increased needs during specific times – for example, retail stores needing additional staff during the festival season. In such situations, it is a good idea to go with temporary staff.
One of the primary deciding factors in the hiring of temporary vs permanent staff members is the costs. Organisations must evaluate the costs for a temporary staff member and the permanent employee to see if the budgets meet the applicable cost constraints.
With permanent employees, organisations need to consider costs of salary, benefits, perks, and others. For the temporary staff, apart from the agreed-upon pay rates, organisations may also spend on training. In many cases, the overall cost spent on temporary staff could be lower than that of the permanent employee. This is because a temporary staff member is not entitled to have several benefits that are mandatory for the organisation to provide to a permanent employee. Such calculations and budgetary forecasts are important for organisations to make the correct decision in the staffing procedure.
Permanent employees of an organisation devote all of their time to the organisation’s requirements and business activities. The engagement of a temporary staff member may vary. The temporary staff member may be associated with more than one organisation at the same time. The organisations need to have a match between their expectations from the staff members and the possible employee involvement and engagement levels.
Temporary staff members and permanent employees come with their benefits and challenges. Organisations need to consider all the applicable factors to determine what suits best for their needs and preferences. For instance, one organisation may have relaxed timelines and strict hiring budgets while it may be the opposite for another organisation. The holistic approach and comparison will provide the organisations with clarity on the hiring decisions.