What's Your Headcount? It Depends...

By Judy Olian**

It used to be simple to get an employee headcount. No more. Companies now employ a wide mix of staff from a variety of sources, and many are not full-time or "permanent" employees. For example,

• Part-time workers represent over 13% percent of the workforce. Some work permanently on reduced schedules. Others fluctuate their hours around non-work needs, such as parents on a full-time10-month work schedule, with summers at home with their children. Partially retired workers often resort to a part-time, and sometimes declining schedule.
  

• Temps employed by staffing agencies constitute about 2% of the workforce. Overall, this is a fairly stable proportion of the workforce except occupational groups like managers, technology, or legal professionals, where use of temps is growing significantly.
  

• Contract employees who work for client companies for longer, but finite contract periods. This includes employees contracted as part of an outsourced service.
  

• Consultants, or virtual employees, who operate as individual contractors "on call", depending on the fluctuating needs of the organization.

These various employment categories complicate the headcount. In many cases these differences are invisible to all but Human Resources, and employees have difficulty separating full-timers from the rest.

Maintaining a mix of employees makes good business sense. It's easier to downsize and upsize contractual employees than it is to flex a full-time workforce. New blood and ideas continue to flow into the workforce. It's a way to retain scarce talent by accommodating the idiosyncratic needs and preferences of workers. Outsourcing removes certain costs and liabilities from the employer such as recruiting and screening costs, and on occasion the burden of employee fringe benefits (about 50% of temps receive no health insurance). Temporary or part time work is often a bridge to permanent employment, offering both sides a chance to preview each other. And, let's not forget that some workers insist on the flexibility and freedom associated with temporary or part-time employment.

With this mixed headcount, however, comes the challenge to preserve the essence of one company, one happy family. It's dangerously easy to evolve into an organization with "employees" who represent to customers little else but the company's business card, with scant familiarity with, or commitment to, the company's values or procedures. From within, there's a risk of creating a gulf between "first-" and "second-tier" employees. And, some workers are permanently deprived the security and perks that come with the status of permanence. So, balance the considerable advantages of a mixed work force against the cultural and moral hazards. It's worth considering.