Businesses are finding new ways to cut their costs while increasing the performance of their team and overall business. This new strategy is taking over 2023 with its continued proven success. This process is called fractional hiring.
Fractional hiring is defined as the prices that businesses undergo when they hire a team of individuals to work for their business rather than only hiring one individual. I know that sounds a little contradictory and it might even be a little difficult to understand how hiring more than one person vs only one can save the business more money, but read on to understand everything about why fractional hiring will prevail in 2023.
To understand why hiring a team rather than an individual is more beneficial to a business, we must first have a clear understanding of what hiring one person entails. When a person is hired by a company, they must first go through a hiring process. This process is expensive and the new employee paperwork and orientation can be quite times consuming. On top of that, full-time employees cost businesses plenty of money in other areas including payroll taxes and benefits such as health insurance or retirement plans. These are the hidden costs of hiring full-time employees that nobody talks about. Until now.
During fractional hiring, companies hire individuals on a freelance or contract basis. The name “fractional” suggests that the individual only works for a fraction of the time. With these types of hires, businesses avoid paying what we referred to as the hidden fees of hiring full-time employees. Instead of hiring an employee and having them go through an orientation, businesses hire fractional employees that can start right away. The teams are hired to work on projects based on their experience. Some individuals might work on innovation first and once that part is done, then an individual with expertise in development can work after them. The beauty of this process is it can work however businesses want it to work.
The key to fractional employees is that they are experts in their field. They don’t require training or additional education to provide businesses with quality work. This all begins to happen the moment they begin working on a project. What’s best is that businesses have the opportunity to hire experts for one part of their business for a specific amount of time in a project, and then they can hire someone different for the next step in their project. Not only do they receive quality work from their fractional employees, but they also have money in the long run.
You might wonder though, why anyone would want to contribute their knowledge and expertise to a business without securing those costly benefits such as insurance or paid time off. The reality is that as experts in their fields, fractional employees charge higher rates than full-time employees would get paid. This gives the fractional employees the advantage to do whatever they please with their money, which can be to buy their own health insurance.
On top of that, fractional employees work fewer hours than traditional employees. A lot of them make the same amount of money working fewer hours, which in turn makes them feel more appreciated. Having that flexibility to set their own schedule keeps them producing quality work for businesses. It is a win-win situation for everyone involved.
Hiring fractional employees this year seems to be the way. With the increasing amount of layoffs, many qualified individuals are seeking new opportunities where they can use their skills while they are compensated fairly. Additionally, they want a place where their time is respected and they can have the flexibility and respect to manage their own time and workload. For this reason, fractional hires are increasing and will continue to increase this calendar year.