Is Contingent Labor Back?
Elevated Resources’ business outlook in the midst of market uncertainties
Needless to say, the business climate of 2020 has been unprecedented as a result of the pandemic and the subsequent downturn in business operations. While like many in our industry, Elevated Resources experienced a dip in demand for contingent labor in Q2 and Q3 of 2020, it appears our customer base is emerging from the downturn and is beginning to hire contingent workers to meet renewed demand for their products and services.
For instance, in Q3 we saw a 20% increase in demand for contingent labor and services and our outlook for Q4 is even stronger.
While our particular experience and expectations don’t necessarily map to the broader economy, they do show some promise for certain industries. We have seen this resurgence with our customers in insurance, life sciences, high technology and a variety of businesses which employ a large number of light industrial workers.
Changes in the contingent worker employment rate have generally been a leading indicator for where broader employment is headed. History has shown us that decreases in demand for contingent workers typically forecast a decrease in the employment rate and, conversely, increases in contingent worker employment foreshadow increases in the overall employment rate. And, because this market fluctuation is a result of extraordinary circumstances, not market conditions, we expect that a persistent recovery is in sight, and will be spurred by advances in vaccines and wider safety measures.
While it is still very early in this COVID and post-COVID business cycle and many near-term risks still exist, we are hopeful our customers’ expectations and activities bode well for their industries and the broader economy as well.