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Five Tactics to Motivate the Contingent Talent You Need Right Now

Orli Becker | December 15 2022 |

Magnit’s Fall U.S. Labor Market Report reveals an already complex and changing hiring environment, now distorted by inflation. Organizations need to think very carefully about how they manage their workforces going forward, including how to set compensation (without breaking the bank) and how to retain mission-critical talent (while downsizing other parts of the workforce). The contingent workforce will be critical in achieving these aims.

Contingent workers are individuals who contribute their valuable labor and services to your organization. They are not only a way to fill temporary gaps in the employee workforce but are now also a critical source of interchangeable talent, skills and expertise that help maintain and grow business.

To maximize the value of contingent talent contribution to the enterprise, traditional contingent workforce sourcing is being complemented with contingent talent management. And positively influencing contingent workers’ motivation is key to managing engagement, retention and, of course, productivity.

Drawing from the Fall 2022 Labor Market Report findings, here are five proven tactics to help improve the motivation, productivity, and retention of your contingent talent:

1. Set contingent talent pay rates using high-precision, real-time market data

Until recently, effective rate setting has always been limited by stale and over generalized data points. But now talent can be “priced” with fine-grained, dynamic market information.  Rather than pigeonholing a worker into a generic role with static pay parameters, individual workers can be “valued” based on specific roles and skills, different geographies and remote work and other factors such as supply and demand conditions.

In the current market, which can be highly competitive in certain segments, businesses should not just focus on securing the lowest cost. It’s more about getting the right talent for the position at the right market price.  Pay is just one of several determinants of attracting, motivating, and retaining the best talent. When compensation is right, organizations attain and keep productive workers, and don’t leave any money on the table.

Get more insights on elevating your global talent strategy with real-time pay intelligence in our webinar.

2. Pay attention to the skill-based hiring of contingent workers

Our research found that pay is unsurprisingly a factor in motivating and retaining workers (e.g., “increasing pay is associated with improved retention outcomes via both longer time on assignment and reduced voluntary term rates”), and that in turn improves business continuity and avoids costs. But research also found that it depended upon the skill and corresponding pay rates. Retention for lower paid positions can be improved with pay rate increases, but above certain pay thresholds corresponding to different roles, pay increases do not significantly impact retention.

According to the findings, most lower-earning workers (whose top priority may be maintaining real income when there is inflation) are more likely to move elsewhere for higher pay. But higher-earning workers “have typically reached a minimum threshold and are much more likely to stay on assignment for intangibles such as career development and unique project opportunities.” This is one example of how considering the worker’s skill and what the individual values over other elements, including intangibles, must be a part of incenting and motivating contingent workers.

For more strategies on retaining contingent talent, check out our blog.

3. Provide benefits that count

Providing benefits has not typically been a key variable in the contingent talent compensation equation. Now, as organizations are reassessing the value of their contractor workforce and focusing more on worker experience, non-remunerative benefits are increasingly being looked to as a strategic lever to improve motivation and retention. Such benefits can be as small as providing more connection, encouragement and constructive feedback (typically not a high priority when it comes to contingent workers) or as significant as offering competitive insurance benefits or professional growth opportunities through learning and development.

Companies that need insights on the types of benefits their talent values can utilize employee sentiment analysis, which is a way for businesses to collect worker feedback in mass volume. This approach can help inform what motivates talent by gauging how workers feel about various aspects about the organization through anonymous surveys. Organizations can strategically use the data gathered through sentiment analysis as they determine which benefits are the most important to their workforce.   

According to Magnit’s research, benefits “may be an important piece of the puzzle for organizations looking to boost retention and time on assignment.” Based on the data analyzed, “higher benefit participation rates are in fact associated with lower voluntary term rates and longer time on assignment.” As suggested above, the range of possible contingent benefits is extensive, and organizations need to offer them according to what contingent workers value most.

4. Activate and increase contingent worker re-deployment

Beyond costly temp-to-perm arrangements with staffing firms, re-deployment of contingent workers to other contingent or permanent positions has not gotten much play in contingent workforce management programs. But by adopting this practice and integrating the right data across silos, organizations can enable contingent worker re-deployment as a proactive strategy that drives cost avoidance and other tangible benefits.

Magnit’s analysis found that, on average, the rate increase for redeploying workers was 10.2%, but on the flipside was 19.4% when businesses hire new workers on the market. Companies that redeploy workers also avoid the costs of sourcing and vetting new workers and drive time-to-fill to zero. Making redeployment a promotable program element can have positive impact on worker motivation and retention. And as a component of employer branding and messaging, it can have a positive effect on talent attraction. However, first the practice has to be adopted and implemented.

5. Contract contingent workers using employer of record (EOR) and direct sourcing solutions

EOR and, increasingly, direct sourcing solutions provide a way for organizations to engage contingent talent without a temporary staffing or professional services middleman, at a time when more skilled workers are choosing to become independent contractors. It’s generally accepted that this disintermediation drives cost savings (according to the Magnit report, “Employer of Record engagements – in which a third party assumes responsibility for worker benefits and risk management – has historically been the most cost effective in providing the lowest markup for contingent labor.") But that’s not all.

These solutions, particularly when they are integrated at the data level, enable organizations to set and revise pay rates more effectively. Companies gain substantially more visibility into talent, and consequently they are able to directly manage candidate and talent experience. A direct sourcing solution, enabled by the right platform technology and talent intelligence capabilities, can set the stage for lifecycle contingent worker experience management. An integrated EOR solution can also go beyond its traditional compliance and payrolling role to be the enabler of benefits for contingent workers, among other things.

While the five aforementioned tactics can be used to improve worker experience, motivation and retention, they also comprise a more comprehensive talent management strategy for a large, growing segment of the modern workforce, which is more critical to business continuity and flexibility than ever.

For more insights on improving your workforce agility, check out the full labor market report.  

If you’re interested in learning more about how Magnit is helping organizations implement winning contingent workforce programs globally, please contact a Magnit representative at

Disclaimer: The content in this blog post is for informational purposes only and cannot be construed as specific legal advice or as a substitute for legal advice. The blog post reflects the opinion of Magnit and is not to be construed as legal solutions and positions. Contact an attorney for specific advice and guidance for specific issues or questions.

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