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Contractor Selection and Management in Times of Labour Shortage

How do you find contractors with the right experience and skills that you can trust when you have the challenge of a significant shortage of labour in the supply chain?

With nearly four in five employers globally reporting difficulty finding the skilled talent they need, reaching a 17-year-high (from 35% in 2013 to 77% in 2023), procurement teams are being left with a reactive, ‘quick fix’ approach to contractor management, just to get the job completed.

In its latest webinar, Alcumus, a leading provider of supply chain risk management solutions in the UK and North America, explores how organisations can improve contractor management strategies, source and onboard credible and compliant contractors and achieve business continuity and resilience.

The challenge

To set the scene in the UK , Anthony Hanley, SVP of Supply Chain Compliance at Alcumus explains that COVID-19 has been the key catalyst that has accelerated the talent shortage, compounded by new Brexit rules and the cost-of-living crisis, resulting in 80% of UK employers unable to fill roles. In North America, which has a similar rate at 79%, Denis Sanchez, VP of Strategy Alcumus Cognibox, shares the same view, despite encouraging levels of employment and role vacancies available.

So, why the shortage of skilled contractors? Quite simply, the talent pool has shrunk, creating a bottleneck as contractors have left the industry to overcome the disruption that COVID-19 brought, not only to available work but also to offset the economic impact it caused. Add to that a growing number of workers retiring or changing careers, the desire to have a work-life balance and evolving age demographics, finding contractors with the necessary traditional trade skills to carry out essential work needed to keep business running is a real challenge.

Less workers are not an excuse to compromise on standards

The reality is, however, that organisations simply cannot afford to cut corners or let standards fall by the wayside when it comes to the contractors or sub-contractors in their supply chain. Why? Because this approach will only increase blind spots and risks, such as business inefficiencies, regulatory non-compliance, fines, the potential for safety failures causing more incidents and accidents as well as environmental impacts and reputational damage.

Organisations can’t keep ‘plugging the gaps’ on unknown or unskilled workers. Taking a back seat and glossing over the importance of skills, training, competence and compliance is not going to solve the problem.

Finding credible, safe, and compliant contractors

Contractor management is about getting it right. So, the key is to implement a robust sourcing and pre-qualification strategy, not just for health and safety, but ethical, sustainable and social value practices too. With an integrated approach, quick access to data insight via technology across all tiers in the supply chain, organisations can be confident they have one true view of who they are hiring and meeting compliance standards.

While there’s no ‘quick fix’ to resolve the current situation, organisations simply cannot afford to run the risk of working with contractors who are not able to prove that they have sound health, safety and ethical policies in place. With trusted data and documentation in hand, companies can be in control, make better sourcing decisions, foresee potential challenges and ensure business resilience.

Watch the webinar in full here.

About Sarah OBeirne

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