25 Mar SIA and Flextrack’s Trends and insights for CW Program Managers: Part 3 of 3
Workforce Optimization Strategies for 2025
Whether it’s recalibrating engagement rules, adopting skills-based hiring, or expanding programs globally, workforce leaders need to take a proactive approach to workforce optimization. But how to do that in the face of constant changes, overwhelming options and siloed, disconnected teams? Discover how to take your contingent workforce programs from legacy and rigid to efficient and growth driven.
On January 30th, Flextrack sponsored the annual Staffing Industry Analyst’s CWS webinar, titled What CW Program Managers Need to Know in 2025. CWS Council Analysts came together to share predictions and discuss practical advice for contingent workforce program managers.
What you need to know in 2025 – Workforce Optimization
As programs mature, or expansion or upgrades are being considered, growing program capabilities and optimizing for efficiency and impact is key, but can mean many moving parts that can get overwhelming.
This blog highlights the key strategies businesses should implement in 2025 to stay agile, compliant, and competitive in the evolving labor market.
Below you’ll find 10 key trends centered on workforce optimization strategies discussed in SIA’s webinar. Dive into each to explore how they are shaping the future of contingent workforce management and how organizations like yours can utilize them to stay adaptable and competitive.
1. Program Expansion – Going Global
The ability to effectively manage a global workforce will be a key differentiator in 2025. As contingent workforce programs scale, program managers and leaders must take into consideration the impact integrations and ease of use have on their expansion into global markets. Don’t hold back on going global, but prepare by ensuring visibility, cost control, risk mitigation, and ensuring a single system of record and consistent processes across all regions.
2. Program Recalibration
Contingent workforce programs emerged out of necessity in organizations, transforming the contingent workforce industry from the wild, wild west into a well-oiled, measurable, and highly commoditized industry. Technologies can now provide visibility, control, and are able to meet the demand for agility and innovation while keeping governance, autonomy, and innovation in a coexisting state.
2025 will demand a recalibration of these programs as they reflect new business priorities and talent expectations. Leaders must empower and prioritize stakeholders and include them in decision-making, providing tailored solutions, reassess vendor return on equity (ROEs), and drive innovation in workforce strategies as they inject accountability and visibility into their organizations.
3. Time to update your rules of engagement?
One of the critical components of having an effective contingent workforce program is rules of engagement in place for the suppliers within the program. Leaders should reassess supplier and hiring manager engagement policies to ensure contact between both is created in a way that brings value to both parties.
Things like onboarding requirements, tenure limits, and furlough policies should be checked often to make sure they align with constantly evolving workforce trends and organizational needs. Outdated organizational policies can create unnecessary friction in talent acquisition and retention.
4. SOW – Everyone wants a piece of the pie
Leaders are seeing and will continue to see increased demand for SOW. This gives organizations access to more senior decision-makers, better relationships. The anticipation is that more legacy staffing firms will start to offer SOW, and more contingent workforce programs are getting in on this through the promise of added value through contracts that give access high-skilled or niche talent who don’t fit traditional temp roles. Expect better pricing, margin opportunities, and longer-term contracts, providing cost stability and strategic workforce planning.
5. Mitigating Candidate Fraud
Beyond initial screenings, workforce leaders must implement ever-more vigilant validation tools to detect fraudulent candidates. A comprehensive fraud prevention strategy is now a necessity, not a luxury.
Ask for ID during the interviews, look for unique individual details, ask staffing companies to be more involved, or try utilizing AI-powered validation tools – being proactive is the key that will help prevent costly hiring mistakes and reputational damage.
6. EOR/AOR Growth – Filling Supplier Gaps
One of the most quickly growing trends is the growth of independent contractors, with an estimated market value of 1.8 trillion globally in the wider gig economy. As the use of IC’s creates some risk, like tax or benefit regulation challenges, it also highlights a massive opportunity for global companies utilizing Agent of Record and Employer of Record companies to maneuver these challenges without the need to set up legal entities across the globe.
AOR supports organizations by handling contracts and payments, navigating compliance complexities, and addressing supplier shortages, while EOR assists with managing payroll, benefits, and labor law adherence.
7. Upskilling the Contingent Workforce
With 170 million new jobs expected to be created globally by 2030 and 92 million set to disappear, workforce leaders must address the growing skills gap to future-proof their operations.
Only 24% of workers feel confident they have the necessary skills that their employers demand, but just 17% believe their employers are actively investing in their upskilling. As a result, companies that proactively develop their contingent talent by, for example, collaborating with suppliers who specialize in higher training will gain a competitive advantage in securing a ready workforce.
8. Skills based hiring
A recruitment approach focusing on skills rather than education or past work experience, skills-based hiring has been a topic of conversation that’s more rapidly gaining ground as a great predictor of job performance and long-term success.
This approach allows leaders to broaden their talent pool by removing unnecessary degree requirements and focusing on real-world skills. On the side of talent, those hired for their skills feel more aligned with company culture and less likely to job hop.
However, it requires skills-based assessments and job description updates to be successfully implemented.
9. Simplify your worker categories
We’re moving away from the flat structure of multiple worker categories and job titles. Reducing worker classifications to four primary categories minimizes confusion, avoids misclassification risks, and optimizes cost and efficiency.
The four categories are: staff augmentation workers, SOW workers, permanent workforce, and independent contractors. A simplified approach leads to better workforce agility and cost control, and leaders don’t have to do this reclassification alone; AI-driven classification tools can aid companies streamline quickly and efficiently.
10. Legal and Regulatory – potential impacts
If you’re feeling confused, you’re not alone. Workforce programs must stay ahead of shifts in immigration, tariffs, and DEI policies, which could significantly impact hiring and compliance strategies. Confusion around new labor laws and worker classification may create risks as well. Program managers must be ready to face constant changes that need to be maneuvered, especially in multinational organizations.
How will workforce optimization strategies shape your organizations future?
