By Michelle Brown, VP of National Accounts
After 35 years in the staffing industry, I've watched numerous economic cycles, technological revolutions, and cultural shifts alter how companies build their workforce. Yet nothing in my career compares to what we've seen in the past three years. The usual patterns that defined our industry have been completely overturned, bringing both challenges and opportunities for businesses seeking flexibility in their staffing.
In a time when U.S. employers are facing unprecedented levels of uncertainty, many companies are weighing their options between working with a staffing partner or directly hiring freelancers and contractors. While hiring freelancers might seem appealing at first glance—that lower hourly rate looks attractive—the calculation should go beyond simple costs. When you factor in risk reduction, administrative complexity, quality assurance, and the time spent managing multiple relationships, my decades of experience have consistently shown that working with a staffing partner delivers superior results.
In the past, economic downturns created predictable patterns for temporary staffing. As companies recovered from recessions, they would turn to temporary staffing before making full-time hiring commitments. This approach gave them room to grow operations while limiting long-term obligations during uncertain periods.
In recent years, temporary staffing hasn't followed the usual recovery pattern. The pandemic fundamentally altered how people relate to work. Workers who previously accepted various arrangements now expect higher pay, better conditions, and meaningful flexibility. That’s one reason freelancers are the fastest growing segment of temporary workers. At the same time, companies that struggled to fill roles during the pandemic have been slow to return to staffing partnerships, instead turning to what seems like a simpler solution: hiring contractors directly.
Yet many of these companies are now discovering that managing individual contractor relationships creates its own set of challenges.
Here's what many companies don't anticipate when they decide to manage contractors directly:
You're three weeks into a critical project when your top contractor stops responding to emails—no notice, no handoff, no backup plan. Meanwhile, the skilled freelancer you thought you'd hired is still stuck in compliance review because their background check revealed an issue you didn't know to screen for upfront.
What looked like savings on paper becomes expensive fast when you calculate the hours spent coordinating multiple relationships, handling administrative tasks that staffing firms manage automatically, and scrambling to replace people who don't work out. That attractive hourly rate loses its appeal when you're spending internal resources on recruitment, vetting, compliance management, and damage control instead of focusing on your core business.
Working with a staffing partner means accessing both temporary employees and contractor talent through a single relationship. Whether you need temporary staff (who work for the staffing company) or independent contractors, the staffing firm handles vetting, compliance, payroll administration, and relationship management. You get the flexibility you want with professional oversight you can trust.
Managing freelancers directly means sourcing, vetting, contracting, and coordinating with multiple individual contractors yourself. You handle all operations and performance management across potentially dozens of separate relationships.
Both approaches can provide workforce flexibility, but they create vastly different experiences in terms of administrative burden, risk exposure, and operational complexity.
What temporary staffing gives you that self-managed contractors can't:
Industries with fluctuating demand cycles can benefit from staffing partnerships. Healthcare organizations can quickly scale nursing staff for patient surges without lengthy individual recruitment. Companies in growing industries like electronic manufacturing and semiconductors can access skilled technicians who can ramp up production for new launches, then scale back without managing multiple contractor terminations.
Traditional manufacturing is another clear example of an industry that benefits from staffing partnerships. During COVID, recreational vehicle manufacturers faced unprecedented demand for ATVs and watercraft only to scale down the following years.
Whether seasonal retail demand, project-based construction, or cyclical manufacturing, staffing partnerships provide reliability that managing individual contractors simply can't match.
As companies rethink their post-pandemic staffing methods, we've noticed a return to more focused vendor relationships. Before COVID, many large organizations had moved from using dozens of staffing suppliers toward master vendor or dual-supplier models. During the height of the pandemic, when finding any workers was the main challenge, many returned to using numerous suppliers.
Now, we’re seeing a shift back toward consolidated approaches as companies recognize the operational burden of managing multiple contractors with inconsistent service standards. Working with one or two strategic staffing partners gives you access to extensive talent networks while maintaining just a few key vendor relationships.
At Kelly, we're responding to industry changes with a combination of personal relationship management and new technology. Our Kelly Now platform demonstrates exactly how working with one staffing partner gives you access to extensive talent networks. Pre-qualified candidates connect directly with our recruiters through the app, delivering faster fills without the administrative burden of managing multiple relationships. We're also testing talent pools that let workers choose shifts, meeting employer flexibility needs while giving workers the autonomy they expect. Instead of coordinating with dozens of individual contractors, you tap into hundreds of available workers through one partnership.
Companies that experienced significant staffing challenges during COVID understandably remain cautious about workforce partnerships. Many turned to direct contractor management as a seemingly simpler solution, only to discover the hidden complexities and resource requirements of coordinating multiple individual relationships without professional support.
Our best client relationships start by acknowledging how the market has changed. Workers want better conditions and more flexibility. Companies need faster scaling without long-term commitments. Smart companies are consolidating their vendor relationships to get both.
After 35 years in this industry, I've seen that temporary staffing consistently outperforms managing contractors individually. Where hiring individual contractors offers a band-aid solution, working with a staffing partner delivers sustainable results with lower risk, better quality assurance, and none of the compliance headaches. The hourly rate might look attractive, but the total cost of managing your own contractors adds up fast. Staffing partnerships remove the administrative burden while giving you access to vetted talent when you need it.
As we continue navigating the post-pandemic economy, these strategic advantages will separate forward-thinking organizations from those still managing workforce challenges piecemeal.