Why Smart Companies Use Contract Consultants During a Recession

In this blog post, learn why smart companies use contract consultants during a recession.

While the recessions of 2008 and 2001 were strong and apparent quickly, a potential recession in 2023 could be quieter, slower, and longer, according to Yong Kim of the Forbes Business Council. During this time, Kim says that demand may shift in an unexpected manner, and the most successful companies will be the ones to shift along with it.

Contract labor is commonly utilized by companies who value the ability to dynamically scale their workforce to their business needs, and by professionals who value the opportunities that this type of work flexibility brings to their careers. The ability to scale workforce capacity dynamically, as well as tap into highly specialized talent on demand basis, is an asset to businesses at any time, but especially during a recession when hiring risk is high.

 If it seems counterintuitive that contract labor would benefit workers, as well as employers, during a recession, it could be because of the assumption that temporary workers are easily expendable resources, and the first to go when businesses experience turbulence. But according to many experts, the current business atmosphere does not lend itself to this conclusion. Read on to learn why contract labor is good during a recession:


1. The Contract Workforce Has Become More Essential 

Due to the pandemic and shift towards remote work, the contract workforce has become more essential than it was during the previous recessions in 2001 and 2008. The current business reality is that surges in demand for talent have forced companies to pay more attention to temporary or contract workers. According to Forbes2, CFOs have taken notice of the shift towards utilizing external workers, and have come to appreciate the financial implications. After all, tapping into external labor has proven to be a sound and flexible model.  



“The benefits of this very model, coupled with its newfound level of popularity, may indeed change the way companies look at labor cost-cutting measures during the next recession. External workers may not be first to go.”  


– Doug Leeby, Forbes Council Member 



2. Contract and Temporary Roles are Abundant

Not only are contract workers more essential than ever before, but the number of openings for contract and temporary roles has increased as well. According to Financial Times,4 the number of contract roles posted by U.S. companies between May and November of 2022 surged by 26% compared to the same period in 2021, based on data provided by recruitment platform LinkedIn. It’s safe to assume that this trend will continue as recession fears loom in 2023, and also a sign that companies are increasingly eager to cut costs. After all, contract workers can be obtained without paying benefits like health insurance, PTO, 401k match, bonuses, and more. 

This is good news from a workers standpoint when you consider that contract work provides flexibility and opportunities, especially for those who are looking to take on gig work as an extra form of income during the recession. For many contract workers such as consultants, contracts allow for career growth they might not otherwise enjoy.    

3. Contract Labor Allows Businesses to Adjust Quickly

From a business standpoint, businesses want to be agile when heading into a possible recession. This means that they are able to pivot quickly when faced with a variety of challenges, whatever that may look like.  According to Yong Kim, engaging with temporary workers enables businesses to adjust their labor needs quickly and on a day-to-day basis. It also creates a more streamlined approach for HR and operations teams to find workers and quickly adjust to unexpected changes.

In conclusion, utilizing contract consultants can benefit both businesses and workers during a recession, especially in today’s business climate. If you work for a company that is looking to add dynamic capacity to your teams or if you are interested in consultant jobs, Eliassen Group may be able to help.


1. https://www.forbes.com/sites/forbesbusinesscouncil/2022/09/21/why-the-temporary-worker-must-be-a-part-of-the-recession-labor-market-discussion/?sh=5a2144117b22 

2. https://www.forbes.com/sites/forbestechcouncil/2022/07/25/external-workers-may-not-be-first-to-go-during-a-recession/?sh=293895226dfa 

3. https://fortune.com/2022/12/23/recession-fears-spark-hiring-contractors-freelancers/ 

4. https://www.ft.com/content/53329655-74b3-4820-a5f9-37ae39ad6d7d