Blog - Navigating Economic Uncertainty: Why Businesses Need Contractors Now More Than Ever | Altum Consulting
Jun 30, 2023

Navigating Economic Uncertainty: Why Businesses Need Contractors Now More Than Ever

Amidst the UK's current economic recession, the job market is experiencing a significant shift. Whilst overall employment opportunities might shrink during these challenging times, one trend surges in the opposite direction - the rising demand for contractors.  

The Flexible Workforce 

The first major factor underpinning this trend is the need for flexibility. In uncertain times, businesses need to be agile, ready to scale operations up or down according to the prevailing economic climate. Contractors, with their flexible work arrangements, provide an ideal solution for this. They offer organisations the capacity to manage workforce levels and costs more effectively, allowing them to ramp up their workforce for specific projects or periods of high demand, then scale back when necessary, without the costs and complexities associated with full-time employment contracts. 

Expertise on Demand 

Another pivotal factor is the need for specific expertise. A recession may force companies to pivot their business models, implement new technologies etc to innovate and stay competitive. This often requires niche knowledge and skills that are not readily available within the existing workforce. Contractors, with their diverse range of experiences and specialisations, can provide these necessary skills on an 'as-needed' basis. This not only fills the immediate skill gap but also facilitates knowledge transfer to existing staff, enhancing the organisation's overall competency. 

Cost-Effective Resourcing 

Lastly, from a financial perspective, hiring contractors can be more cost-effective during a recession. Full-time employees represent a fixed cost, with salaries, benefits, and other associated expenses that must be paid regardless of the business's performance. Contractors, on the other hand, represent variable costs. They are typically engaged for a specific period or project, with costs directly tied to the value they deliver. This arrangement provides businesses with a more efficient way to manage their human resource expenditures, which is crucial during a period of financial strain. 

The current UK recession, like any period of economic uncertainty, brings challenges and opportunities. As companies navigate this landscape, the value of a flexible, skilled, and cost-effective workforce becomes increasingly apparent. Contractors, with their unique work arrangements and diverse skill sets, are well-positioned to meet these needs, marking a potential rise in their demand in the coming times. 

In a world that is rapidly evolving, the ability to adapt and pivot is critical. For businesses looking to weather the storm and emerge stronger, engaging contractors might just be the key. 

As we continue to monitor these developments, we're keen to see how the role of contractors evolves in the post-recession UK economy. One thing, however, is certain: their importance is set to grow, serving as a beacon of hope for many amidst the economic uncertainty.  

Want to know more?