September 26th, 2022 | Ken Schnee

Embracing the Contingent Workforce: Optimized Hiring Processes Ease the Transition

Over the past two years, as businesses worked to navigate pandemic-related restrictions and an increasingly unpredictable job market, the demand for contingent workers has risen sharply in the US. And while many of the experimental safety measures introduced by Covid-19 may eventually be lifted, there is growing evidence to suggest that companies will increasingly come to rely on contingent workforce for their staffing and hiring needs.

According to statistics released in a US Accountability study, and reported on by PeopleScout, 40% of the US workforce is now populated by contingent workers, and that number is expected to jump by an additional 10% by 2050. Given this trend’s momentum, and the fact that the technology industry has been so enthusiastic in its embrace of contingent work, now both freelance and contract-based positions seem poised to become the new mainstays of an increasingly modernized workforce.

Of course, hiring contingent workers en masse comes with its fair share of challenges, and this workforce may need to be supported by modernized hiring processes, including those related to security considerations like background screening and identity verification. In this blog post we’ll explore some of the unique advantages of hiring contingent workers for tech companies, while also detailing how optimizing the hiring process – from background screening to the overall candidate experience – can help tech businesses hire more efficiently and with a renewed sense of confidence about employee safety.

The Evolving Hiring Landscape in Tech

Much like remote and hybrid arrangements, it would be reasonable to assume that the contingent work trend was born primarily in response to pandemic-related requirements and restrictions. While this may be true to an extent, tech companies have been showing an increased interest in the contingent workforce since before the Covid-19 virus ever emerged.

According to a study published by Aon, 94% of tech companies were already utilizing contingent workers as early as August 2019, and more than 21% of the companies surveyed had active plans to expand their contingent workforce. Naturally, by December 2020, the contingent work trend accelerated, greatly favoring consultants and freelancers in the tech and corporate space, with an estimated 40% of white-collar workers at the time being employed on a contingent basis.

To better understand this tech trend toward contingent work — and why we shouldn’t expect it to go away any time soon — it helps to take a brief look at some of the benefits. Here are just a few powerful incentives for tech employers to consider:

Cutting costs. In May 2020, a Gartner survey showed that 32% of businesses across industries were replacing their full-time employees with contingent workers with the specific intent of reducing costs. This is perhaps one of the more obvious advantages of workers employed by contract: hiring for a pre-determined timeframe or on a project-by-project basis is often less expensive than providing salaries and benefits to full-time employees across an organization.

Leveraging diverse skillsets. Tech companies frequently need to utilize a wide range of specialists, whether in software development or strategic innovation. However, when a worker’s skillset is only needed for a specific project or product rollout, hiring that person full-time is often impractical, and difficult to justify from an expense management perspective. The growing contingent workforce gives tech companies access to professionals in virtually every area of expertise, and allows them to acquire the talent they need without making a long-term financial commitment.

Maintaining remote capabilities. The pandemic helped reinforce the fact that it helps to be as prepared as possible for an unexpected disruption of operations. As many businesses have recently found, having the option to hire remote workers on a contingent basis makes it much easier to adapt to external influences outside of an organization’s control. Luckily, many were quick to appreciate this fact, helping businesses hire and manage contingent workers more efficiently.

Challenges and Solutions

Importantly, hiring contingent workers in the digital age comes with unique challenges and risks. Instances of fraud and cybersecurity attacks, for example, have been on the rise since the pandemic caused an uptick in technological adoption and digital transformations. But contrary to popular belief, threats aren’t necessarily limited to the theft of assets and sensitive information.

In Sterling’s recent survey on hiring trends in the staffing industry, we uncovered a significant increase in identity theft perpetrated by job candidates. Of the 188 staffing companies we interviewed, 40% had an end client discover a potential new hire had lied about their identity on an application, while 30% reported at least one incident in which the person who showed up for their first day of work was a different person than the one who completed the pre-employment assessment.

Needless to say, hiring someone whose identity can’t be verified poses both a physical and a cyber risk to everyone within the organization. Moreover, tech companies hiring remote contingent workers may be inherently more vulnerable to costly deception. In short, in order to fully embrace and integrate contingent work into a modernized workforce strategy, businesses shouldn’t need to compromise safety for efficiency; the two should always go hand-in-hand.

At Sterling, we’ve recently noticed an increase in tech companies looking to bridge that gap between safety and efficiency, particularly when it comes to hiring contingent workers. To meet this demand, we’ve developed a fully-integrated platform that simplifies the background check processes, and also makes hiring and managing contingent workforces more efficient — all without compromising the candidate experience.

Here’s just a snapshot of what Sterling’s contingent workforce screening has to offer:

Customizable requirements and streamlined permissions. The requirements you have for your employees and the protections you need are likely unique to your organization, and Sterling makes it simple to design a screening program that checks every individual box. Simply define the services you need — criminal background checks, workforce monitoring, ID verification — and Sterling will create an easy-to-navigate, customized contractor hub where your candidates can enroll on any device.

Automated processes to accelerate time-to-hire. Increased demand for contingent workers means increased competition for a contractor’s time and expertise. Now more than ever, candidates require a seamless experience throughout every step of the application and interview process, including background checks and identity verification. By leveraging automation, Sterling streamlines the screening and data collection process, optimizing engagement and saving valuable time for both employers and candidates.


Flexible compliance tools and protections. Mitigating compliance risks can be a challenge for any organization, and one factor companies can overlook when integrating a hybrid workforce is not providing a consistent screening experience for both full-time employees and contingent workers. Sterling’s platform provides companies with modernized compliance tools which help employers comply with Fair Chance and Individualized Assessment guidelines, while also offering advice from our in-house compliance advisors, to help keep up-to-date on evolving compliance and regulatory obligations.

Overall, the ongoing influx of contingent workers in the tech industry has the potential to greatly enhance business capabilities and drive innovation. But, as many companies have learned through experience in recent years, navigating change is never an easy task, and it’s important to approach new business models as holistically as possible in order to both accelerate the transition and eliminate risks that inherently arise from a move into unchartered territory. If you’d like to learn more about Sterling’s contingent workforce screening platform and how it might help your business hire contractors more safely and efficiently, click here to get started today.

Sterling is not a law firm. This publication is for informational purposes only and nothing contained in it should be construed as legal advice. We expressly disclaim any warranty or responsibility for damages arising out this information. We encourage you to consult with legal counsel regarding your specific needs. We do not undertake any duty to update previously posted materials.