Why Interim Talent is a win-win for employers and workers
Clareza Partners | Article
Summary: Companies are revisiting their workforce strategy and starting to use Interim Talent schemes not just as a means of temporary hiring but more widely to meet their key talent needs. On the other hand, Interim Talent is also beneficial for seasoned leaders and professionals in terms of autonomy as well as personal growth and career development.
Interim Talent, or sometimes called as Interim Management, is a temporary hiring in terms of leadership and professional talent. When a key position becomes vacant, companies have made a request to an outside human resources or consulting firm to provide experienced Interim Talent to fill the role until a successor can be hired.
In recent years, due to the intensifying competition for talent and changing values of workers triggered by COVID-19, companies are revisiting their workforce strategy and starting to use Interim Talent schemes not just as a means of temporary hiring but more widely to meet their key talent needs.
Why are employers expanding the use of Interim Talent?
One reason is that many employers are suffering from talent shortage. According to 2023 Global Talent Shortage survey by ManpowerGroup, 77% of employers report difficulty finding the skilled talent they need, reaching a 17-year high and more than double the difficulty in 2015 (38%). In the Japanese market in particular, despite having the third largest GDP in the world and a market that is attractive for various industries, many global companies struggle to recruit excellent leaders or professionals, due to scarcity of English-speaking talent and the long-term trend of declining working-age population.
On the other hand, the COVID-19 pandemic has led an increasing number of people, especially those with skills and experience of high market value, to reevaluate what they want from work and from life, creating a large pool of workers willing to work in a more flexible manner. Employers can approach such skilled workers by assigning them as Interim Talent.
Another reason is that employers prefer more flexibility in their workforce. In today's fast-changing world, companies have an increasing need to adjust their workforce according to circumstances, and ensure that their employees have the skills needed for the next era. However, the method of hiring new full-time employees and conducting redundancies every time the business fluctuates or skill requirements change is no longer viable. This approach is not only costly in terms of hiring and termination costs, but also leads to deterioration of the company's brand in the labor market, making it increasingly difficult to attract and retain talent. Alternatively, employers can encourage and support existing employees to reskill, however not all of them have the desire and ability to acquire new skills.
Particularly in Japan, where the culture encourages employees to continue working for the same company, making it difficult for so-called "healthy turnover" to occur, many global companies are troubled by the rigidity of their local organization. The high cost of recruitment (30%-40% of annual salary) and legal hurdles to redundancy make it very difficult to swiftly adjust full-time workforce in response to changes in the business environment. There is a growing demand to drive change and add new expertise and experience, by bringing in Interim Talent into the organization.
Now let's look into why working as an Interim Talent could also be beneficial for workers.
As mentioned earlier, COVID-19 has brought about a major shift in what people want from work and from life, and those who prefer to work in a more flexible way have chosen to transition from a full-time employee to a non-permanent worker, such as a freelancer or a part-timer. Such non-permanent workers may not be as stable as regular employees in terms of income, but they have greater autonomy in deciding when and where they work, and what kind of work they would do. Especially for talent with excellent track record as a leader or a professional and have the capability to adapt to change, autonomy tend to become relatively more important than job stability, hence working as an Interim Talent would be an attractive option.
Interim Talent can also be beneficial in terms of personal growth and career development. In today's fast-changing business environment, agility, adaptability, and the ability to drive innovation have become essential leadership skills which companies are looking for when hiring to fill their executive positions. Companies are realizing that experience in several different companies, industries, and professions can help develop these skills and are incorporating them into their hiring strategies. Working for various companies as an Interim Talent is a perfect opportunity to futher develop such leadership traits, increasing the individual's value in the talent market.
Historically, companies have attracted skilled workers by hiring them as permanent employees, which generally comes with more benefits and job security compared to non-permanent hires. However, since the values of work and life has changed and diversified, offering a permanent job may not necessarily be the best approach to attract the best talent going forward. Workforce strategy in the new era should be a combination of permanent and non-permanent employment, such as Interim Talent, which creates a win-win situation for employers and workers who desire to grow and build their careers in a more autonomous and flexible way.
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