The way that companies now work with talent has changed completely, and it’s changing quite fast. Technology is now allowing us to work with remote talent, which has also opened up new modes of employment. Today, almost 72 million people have chosen to work independently rather than take up a permanent full-time job. Most independent contractors are also quite satisfied with the creativity and flexibility that the career provides. Most of them also plan to remain independent while building even larger businesses. This also comes with benefits. Here are the top 15 independent contractor benefits in 2024 that might just turn out to be the right choice instead of hiring an entire team.
Not to mention, independent contractors are also a great way to get the expertise and skills required without having additional cost and compliance challenges. Let’s get to know why we state that hiring independent contractors has its own benefits through this blog.
Table of Contents
- Why Independent Contractors Are Valuable for Businesses
- Top 15 Benefits of Hiring Independent Contractors in 2024
- Leveraging Technology for Independent Contractor Management
- Conclusion
- FAQs
Why Independent Contractors Are Valuable for Businesses
Being an Independent contractor means that you are not considered to be an employee of the company however you are considered as self-employed. You are contracted to perform a specific service or task for a client based on your expertise. Hiring an independent contractor also has its own merits especially when it comes to employers.
Flexibility
As employers, you need not restrict the individual to a certain area or command them. You can provide the flexibility required based on which they can choose when where and how to work on that particular project. Not to mention you also get to hire more contractors as compared to employees when you check the cost involved.
Competitive edge
Since hiring independent contractors involves skilled people, you get to interact with just the top-skilled individuals. Not to mention, since they are hired for a particular project you can decide on how you want to structure your project based on the individual contractor’s availability. This expertise also provides a better competitive edge than other employees.
Tools and equipment
As an employer, you are not obligated to provide contractors with tools and equipment. Independent contractors must own their own devices, tools, and accessories to deliver their services. This also means that eventually, you get to save a lot of money in terms of the tools required.
Top 15 Benefits of Hiring Independent Contractors in 2024
Most of the organizations are more likely to be hiring regular employees. While there is nothing wrong with that since there are benefits of hiring employees as well, hiring independent contractors could also be beneficial for your organization. However, when you compare contractor vs employee benefits it could be more efficient in terms of cost and productivity to hire a contractor since you only pay for the job done without incurring other costs.
Let’s take a look at the top 15 benefits of hiring independent contractors in 2024.
Increased Flexibility
While finding a highly skilled full-time employee could be a great option, there could be lots of costs when it comes to continued employment. Outsourcing work to independent contractors is often much more effective in terms of cost than hiring a permanent employee. Once you complete the project independents will move onto a new contract which means you need not look out for continued employment.
Access to In-Demand Skills
Workers in most of the specialties are trying to move away from traditional employment and towards a remote work model. The independent contracts you will get to engage with for projects or specialized work will also have a lot of in-demand skills.
Remember that independents have built an entire career based on what they know about their industry. Such remote talent could be one of the sought-after workers, especially in areas like marketing, IT, consulting, and biotechnology.
Competitive Advantage
Hiring independent contractors gives organizations its own staffing flexibility which allows them to either staff up or down according to their ambitions and goals. This could make businesses more competitive and agile while not having to spend much on recruiting, hiring, and training permanent employees.
Cost Savings
Cost savings in itself could be said as one of the most beneficial aspects of hiring contractors. Unlike full-time employees independent contractors do not need the same level of financial commitment as businesses need not pay for their benefits such as paid leave, retirement contributions, or health insurance.
Reduced Onboarding Time
Since the independent contractors are hired specifically for their expertise businesses do not need to invest much in terms of both resources or time into training or onboarding. This could significantly reduce the onboarding time and could be one of the independent contractor advantages that you get. This also could lead to overall efficiency while also aiding a faster project completion.
Suggested Read: How to Become an Independent Contractor: Step-by-Step Guide
Corporate Agility
Independent contractors allow organizations to respond with much more flexibility to meet the demanding market needs. Engaging independent contractors for projects that require specific skills or additional resources also allows organizations to access in-demand skills which could lead to better management of turnover, flexibility in cost models, and to get to the competitive market faster.
Fast Talent Re-Engagement
One of the best independent contractor benefits could be the ability to re-engage with them even for future purposes. Independents who have already worked with your company will already know how the projects work. This makes the onboarding and re-engagement process much faster.
Increased Efficiency
When you tend to lower costs and have better access to talent you tend to move faster in the industry. Independent contractors will help companies to become more agile which could help increase the supply chain while also increasing the overall efficiency in terms of performance.
Increased Productivity
When you compare contractor vs employee benefits, freelancers may tend to complete deliverables much more quickly since they are used to remote work. Also, they do not generally get pulled over into meetings or get interrupted by co-workers which allows complete focus on their work. You could also amp up your productivity by selecting freelancers from different time zones. This allows better workflow that follows the sun.
Reduced Overhead Expenses
Independent contractors tend to be quite cost-effective since they can engage for a set period of time and could contribute significantly in areas of their expertise. Once you have a system in place to hire, engage, and manage independent contractors there are low overhead expenses which are associated with respect to building a pool of remote talent.
No Employment Benefits
There are many independent contractor benefits which also include not having to provide traditional health benefits such as health insurance, retirement plans, or stock options. Independents also do not receive the same legal protection as employees such as anti-discrimination, unemployment, and workers’ compensation.
Nevertheless, it is still a great practice to ensure contractors have all their basic insurance requirements added to their contracts to protect against any legal issues.
Project-Based Engagement
Hiring an independent contractor instead of investing the time and money to hire an employee with the same skills just makes much more sense for a lot of organizations. Independents operate as individual businesses where they complete their work as mentioned for the client. Once the project has been completed the independent contractor goes on to their new project contract. They do not have any pressure regarding termination or continued employment.
Minimal Management Required
Since independent contractors are their own business entities it is up to them to decide when, how, and where they are required to complete the work that has been mentioned in the contract. While they will report to a manager they need much less control over them than a traditional employee which is also one of the independent contractor benefits that businesses get.
Reduced Administrative Work
Initial onboarding procedures such as contract reviews, background checks, and compliance tasks could be streamlined with software such as Asanify. You could also automate basic tasks such as payment, background checks, and engagement documentation.
Access to a Global Talent Pool
With remote talent being on the rise, there have also been a lot of changes in terms of technology to engage with them. There is also the elimination of third-party agencies instead contractors and businesses can engage directly. An independent contractor can also fill out profiles on a talent marketplace which keeps them open to opportunities as well as helping organizations find their match.
Also Read: Freelancer vs Independent Contractor: A Guide for Employers
Leveraging Technology for Independent Contractor Management
In order to achieve workforce agility and understanding the benefits of hiring independent contractors it is important for organizations to create a program that can help them manage how independent workers are hired. A centralized engagement program such as Asanify is surely the solution that could help organizations find, engage, and manage independent talent while also ensuring compliance with laws.
A direct sourcing of independent contractors could also help managers find their talents directly instead of going through other third-party agencies. Along with a direct centralized program, the sourcing strategy could also help organizations to stay compliant, manage independent contractor spending, and help increase work efficiency.
Conclusion
When comparing contracts and employee benefits, contractors offer distinct advantages. They are especially beneficial for short-term goals. However, if your organization is looking at growth and vision long term benefits then hiring employees would be the better choice. While it may seem like your organization is paying a lot for the independent contractors however when you asses it, there may be fewer costs associated.
While now that you are well aware of the independent contractor benefits that you get you must also take care that you follow all the rules, regulations, and labor laws. This is especially applicable if you are looking to hire internationally.
FAQs
What are the key benefits of hiring independent contractors?
The key benefits that could be noted when you hire an independent contractor could be provided as follows:
- Reduced costs
- Flexibility
- Reduced administrative burden
- Specialized expertise
- Perfect for short-term projects
How do independent contractors help with workforce agility?
Independent contractors can fill skill gaps within your organization. They help bridge the gap to competitive market skills. They also help with the costs associated with a project which in turn also helps with workforce agility.
Are independent contractors more cost-effective than full-time employees?
If you are talking about short-term projects, independent contractors could be a cost-effective option. Hiring full-time employees requires more time and money.
How can Asanify help with managing independent contractors?
If you wish to manage your independent contractors with a hassle-free process in place, then Asanify could be your best choice due to the following support that you get:
- Easy one-click payroll generation
- KPIs and timesheets that help manage your productivity
- Generation of auto invoice which eases out transactions.
Not to be considered as tax, legal, financial or HR advice. Regulations change over time so please consult a lawyer, accountant or Labour Law expert for specific guidance.
