How to Keep Job Orders From Going Over the ‘Fiscal Cliff’

(Editor’s Note: This is the next in a series of guest blog posts about contract staffing, courtesy of Top Echelon Contracting, the recruiter’s back-office solution.  Similar posts will appear in future issues of The Pinnacle Newsletter Blog.)

The American economy is teetering on the edge of the “Fiscal Cliff,” but that doesn’t mean your job orders have to go over with it.

If Congress can’t come to an agreement by December 31, across-the-board tax increases and government funding cuts will automatically go into effect.  Many experts are predicting that if something isn’t done by December 31, the United States could go into another recession.  With that threat looming, many employers are taking a wait-and-see-approach to hiring.

According to a recent Staffing Stream article, “Reducing Fear of the Fiscal Cliff,” it’s not that employers don’t want to hire.  In fact, 58% of executives surveyed by Korn/Ferry International say they intend to increase hiring in the next 12 months.  However, they are not going to start that hiring until the future is more certain.

That is obviously bad news for recruiters who depend on direct hiring for their livelihoods.  But there is some good news. The Staffing Stream article suggests that contingent staffing may see a boost as a result of this situation.  The article predicts that temporary/contract staffing in 2013 will be especially strong for information technology, marketing, and engineering.  After all, regardless of their fears of the future, employers need to have enough staff to handle today’s business demands.

Contract staffing allows them to get the help they need now without the commitment of a direct hire.  Rather than having to conduct mass layoffs if the economy does indeed go over the cliff, they will be able to simply end the workers’ contract assignments.  Plus, they won’t have the burden of unemployment, Workers’ Compensation, or benefits.

So if you have clients who need to hire, but are reluctant to do so due to the economic uncertainty, you may want to suggest that they bring in contractors.  And don’t worry if you have never placed contractors.

All you need is a good contract staffing back-office, such as Top Echelon Contracting, to become the legal W-2 Employer of Record for your contractors.  By partnering with a contracting back-office, all you have to worry about is recruiting.  The back-office will handle all of the legal, financial, and administrative details.

What will happen with the economy in 2013 is anyone’s guess.  But by adding contract staffing to your business model, you can be ready for whatever comes along.

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