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Contingent Labor refers to the collective workforce of non-permanent workers that organizations engage to perform work without traditional employment relationships. This includes independent contractors, freelancers, temporary workers, consultants, and gig workers as a category of labor distinct from permanent employees. Managing contingent labor effectively has become a strategic priority as this workforce segment grows and becomes critical to organizational agility.
Contingent labor has grown from a supplemental resource to a strategic workforce component:
This shift reflects fundamental changes in how work is organized — more project-based, more specialized, and more globally distributed.
Organizations leverage contingent labor for various strategic purposes:
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Book a Demo Mature organizations manage contingent labor through structured programs:
Without program management, contingent labor becomes fragmented — shadow spend, compliance gaps, and missed savings opportunities.
WorkGenius provides the platform and talent for effective contingent labor programs:
Whether you're starting to formalize contingent labor or optimizing an existing program, WorkGenius provides the foundation.
Contingent workers refers to individuals (a contractor, a freelancer). Contingent labor refers to the collective workforce category or the labor market segment. Organizations talk about their "contingent labor program" or "contingent labor spend" when discussing the category, and "contingent workers" when referring to specific individuals.
There's no universal benchmark — the right amount depends on your industry, business model, and workforce strategy. Tech companies often run 30-40% contingent; traditional industries may be lower. The key question isn't the percentage but whether you're using contingent labor strategically (for appropriate use cases) rather than reactively (because permanent hiring is too slow).
Both have legitimate claims. Procurement brings supplier management expertise, contract negotiation, and spend visibility. HR brings workforce planning integration, talent development perspective, and employment law expertise. Many organizations create dedicated contingent workforce management functions that bridge both, or assign based on worker category (HR for direct freelancers, Procurement for agency temps).
Key metrics include: spend (total and by category), headcount (contingent vs. permanent ratio), time-to-fill (how quickly can you staff needs), cost per engagement (including all fees), quality scores (manager satisfaction, performance ratings), compliance rates (classification accuracy, policy adherence), and utilization (are contingent workers productively engaged).
Explore more concepts in our workforce glossary
Any worker engaged outside of traditional permanent employment, including contractors, freelancers, temps, and gig workers.
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