The global economy is again facing the specter of a recession, as many indicators point to a slowdown in growth. While recessions are often seen as adverse events, they can also change how businesses operate. One area that is particularly affected by economic downturns is the contingent workforce. In this blog post, we’ll take a closer look at what a recession is, how it affects the contingent workforce, and what businesses can do to prepare.

What is a recession?

A recession can be explained as a phase of economic lowering characterized by a decrease in the gross domestic product (GDP), an increase in unemployment, and a reduction in consumer spending. Recessions usually last up to a year but can sometimes last much longer. The last global recession, caused by the financial crisis of 2008, lasted from December 2007 to June 2009.

Impact of recession on the contingent workforce

The contingent workforce comprises temporary, freelance, and contract workers who are not employed on a full-time basis. This group of workers is often the first to be impacted by a recession as companies look to cut costs and reduce their workforce. The reasons for this are straightforward: contingent workers are more accessible to lay off than full-time employees, and they typically do not receive the same benefits, such as health insurance and paid time off.

During the last recession, the contingent workforce was hit particularly hard. The number of contingent workers declined by nearly 20% between 2007 and 2010, as per the Bureau of Labor Statistics (BLS.GOV). This was a significant loss, considering that the contingent workforce was already a growing labor market segment before the recession.

The impact of the impending recession on the contingent workforce is likely similar. As companies look to reduce their costs, they are likely to turn to contingent workers to cut their workforce. This could lead to a decrease in contingent workers and a reduction in their earning potential.

How can businesses prepare for the impact of the recession on the contingent workforce?

While a recession is not a joyous event, businesses can take steps to mitigate its impact on the contingent workforce. Here are a few ways that companies can prepare:

  1. Develop contingency plans: Businesses should intend to reduce their workforce in the event of a recession. This plan should include a strategy for managing the needs of the contingent workforce, such as offering them alternative work arrangements or providing them with support for finding new employment.
  2. Invest in training and development: Companies should invest in training and development for their contingent workers, as this will help to keep them engaged and motivated. This can also help to create a more skilled and resilient workforce, which can be a valuable asset during a recession.
  3. Foster a positive company culture: Companies should strive to create a positive company culture that is inclusive and supportive of all workers, including contingent workers. This can foster loyalty among the contingent workforce and encourage them to stay with the company even during tough times.
  4. Offer benefits and support: Companies should consider offering benefits and support to their contingent workers, even if they are not required by law. This could include health insurance, paid time off, and access to training and development programs.


The impending recession will likely substantially impact the contingent workforce. As companies look to reduce costs, they may turn to contingent workers to cut down their workforce, resulting in a drop in the number of contingent workers and a reduction in their earning potential. However, businesses can take the above-mentioned steps to alleviate the impact of the recession on the contingent workforce. This can also support businesses and help to create a more resilient and skilled workforce that can weather the challenges of the impending recession. In the coming years, it will be necessary for companies to stay informed about the economic climate and take proactive steps to prepare for the impact of the recession on the contingent workforce. 

As a staffing and consulting firm, Infojini can help businesses navigate the impact of an impending recession on their contingent workforce. By partnering with Infojini, businesses can navigate the impact of an impending recession on their contingent workforce and ensure that they are getting the most value from their investment in temporary, contract, or freelance workers.

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