Staffing Explained: The Differences between Direct and Contingent Staffing

Hiring a single employee is a multi-step process that often demands a tremendous amount of time, effort, and financial investment from the employer. It can tie up resources as the HR team works to define the role, writes and posts the available opportunity, screens candidates, interviews prospects, negotiates compensation, and hopefully brings the hire on board. Now, multiply this process for every vacancy in the organization. 

Many organizations lack the personnel, money, and other means to carry out the necessary activities to recruit viable talent. For them, the solution is to work with a direct or contingent staffing agency.

What Is Direct Staffing?

Direct staffing — also known as direct hire staffing, direct placement staffing, and permanent placement — is the practice of matching employers with full-time, permanent hires. A company might partner with a direct staffing agency when it needs to fill a key role without devoting its time and human resources to the effort. 

The staffing agency, for its part, is the intermediary between the company and the person who eventually fills the role. To find that person, the agency gathers the employer’s requirements and taps into its talent pool to identify qualified candidates. This arrangement can streamline the employer’s hiring process.

What Is Contingent Staffing?

An alternative staffing model that employers commonly use is contingent staffing, also known as contract staffing, temporary staffing, or contingent workforce management. This model differs from direct staffing in that it focuses on placing hires on a short-term basis. A company might work with a contingent staffing agency to satisfy seasonal ramp-ups, fill out the personnel for a project, or otherwise fill a temporary gap.

Employers might go the contingent staffing route because of short-term benefits relating to cost and flexibility. The idea is that short-term workers require less financial investment because they often don’t receive full benefits or their benefits are provided directly from the staffing partner, and their compensation runs only for a defined period. That limited investment also means the employer can more easily and humanely scale their workforce up or down as needed and without the need to terminate teammates upon completion of an assignment. 

Why Are the Benefits of Direct and Contingent Staffing?

While both direct and contingent staffing offer unique benefits, there is no one-size-fits-all solution for every organization. The advantages provided below are a guide to help determine which staffing approach best aligns with your organizational goals.  

Direct Staffing Advantages:

  • Stability and Loyalty: Direct employees often exhibit a higher level of commitment and loyalty to the organization since they perceive their roles as long-term career opportunities.
  • Cultural Alignment: Direct staffing better enables companies to select candidates who align well with the organization’s values, culture, and objectives, fostering a cohesive work environment, though this can still be achieved with contingent staffing models and a trusted staffing partner.
  • Control and Consistency: Employers have greater control over the performance, schedules, and work quality of direct staff, promoting consistency in operations.

Contingent Staffing Advantages:

  • Flexibility and Scalability: Contingent staffing allows companies to quickly adjust their workforce size and composition in response to changing business needs, seasonal fluctuations, or project requirements.
  • Cost Savings: Employing contingent workers can be more cost-effective than hiring full-time employees, as companies can avoid expenses such as benefits, paid time off, and healthcare coverage.
  • Access to Specialized Skills: Contingent staffing enables organizations to access a diverse pool of talent with specialized skills and expertise for short-term projects or niche roles.

Partner With Medix To Create Your Ideal Labor Mix

The optimal staffing model depends on factors such as the nature of the business, industry trends, budget constraints, and strategic objectives. In many cases, a hybrid approach that combines elements of both direct and contingent staffing may offer the best of both worlds, providing companies with the flexibility to adapt to dynamic market conditions while maintaining a core team of dedicated employees.

Partnering with a dedicated staffing agency such as Medix, that specializes in both direct and contingent staffing, can help you plan your health organization’s labor mix. With more than 20 years of experience in healthcare, technology, life sciences, and government services, Medix has the expertise necessary to help companies and organizations just like yours source highly-qualified candidates for key roles. Contact us with your staffing needs to get started.

Background Image

Work with a Trusted Healthcare & Life Sciences Staffing Partner

Connect with Medix to get the expertise and resources you need to succeed.

Contact us now