Workforce planning: outsourcing skills

More employers are outsourcing the skills they need with at least 5% of New Zealand’s workforce made up of self-employed contractors.

Nearly 144,000 New Zealanders work as self-employed contractors, according to latest figures from Stats NZ.

Does your business outsource the skills it needs, or recruit them? The following industries feature the highest proportion of contractors across New Zealand:

• professional, scientific, technical, administrative, and support services (14 percent)
• rental, hiring, and real estate services (13 percent)
• information media and telecommunications (13 percent)
• construction (12 percent)

Outsource or recruit?

The decision to recruit or outsource the skills your business needs should be outlined in your business’s HR workforce plan.
A workforce plan aligns a business / organisation’s people strategy with its goals for the year ahead. This will include recruitment, retention, redeployment, leadership and employee development.

Human Resources and Talent Acquisition managers can then provide the company with the talent they need, in the right place, and at the right time.

We use the following cycle to establish a workforce plan:

EQ Workforce plan

Outsource: pros and cons

Weigh up the advantages and disadvantages of outsourcing when developing your workforce plan. Consider the following when compiling your business’s workforce plan:

PROS

Specialists: Draft in specialist skills as and when you need them

Lower overheads: A contractor will supply their own tools and equipment

Generate revenue: Depending on the type of work and arrangement, contractors can provide additional sources of revenue

Spread your services: Increase your business presence further afield

Local knowledge: Take advantage of the contractor’s local knowledge and contacts

Flexibility: Outsourcing talent allows you to be as flexible as your business needs

CONS

Rates vary: Contractors set their own rates. Can you afford the skills you need?

Longevity: Your contractor may not be around forever - will you need the skills on a more permanent basis?

Return: Consider whether you are going to receive the same return as you would with an employee

Flexibility: It works both ways. Do their hours work for your business? Agree timeframes in a written agreement to ensure work is delivered on time

Quality: Is their standard in line with the company’s and clients’ expectations? Outline the company’s requirements from the outset

Fees: Do their costs align with company budgets? Weigh up the return of investment against the need of the skills required

Next steps

Always refer to your workforce plan and business goals in order to create a recruitment strategy. This will identify any gaps in your workforce and the required short and long-term solutions.

Does your organisation need assistance with its workforce plan? Speak to one of our HR consultants for further advice. Call (03) 366 4034 or email info@eqconsultants.co.nz