Internal Marketplaces: Future of Hiring

When the pandemic hit in 2020, businesses met hiring challenges unlike ever before. Finding and vetting new talent became more complex, and the labor market hit a record-holding unemployment rate. In addition, remote working increased, resulting in enormous changes in how we work. 

As a result of the pandemic, everything from onboarding to training to developing a thriving office culture was heavily disrupted. Thanks to these uncertain times, many companies were forced to restructure quickly and fill the skills gaps left behind. In some instances, companies began to use freelancers to plug those skills gaps. But, rather than always starting from scratch when recruiting temporary staff, the focus shifted to building their own internal marketplace. 

Consequently, we saw a surge of employers capitalizing on their employees' untapped potential, working harder to hire freelancers, and fostering good communication with them. According to a 2021 Udemy report, employee on-the-job training rose by 14% between 2019 and 2021, with 62% of employers reporting that the training was necessary to 'close the skill gap.' In the case of freelancers, 55% of companies use them to reduce costs and 49% to access skills not available within their existing permanent internal marketplace. 

As a result, many companies learned firsthand that true HR adaptability is achieved not only by focusing on their internal marketplace but also by using a freelancer management platform to help them onboard, manage, pay, and retain a reliable and consistent freelancer network.  

So, with that said, let’s examine why a freelancer talent pool should be part of your internal marketplace and what this might mean for your business. There’s lots to share with you, so grab a cup of java, and let’s dig in! 

A Bit of Background

Traditionally, when referring to an internal marketplace, we’re talking about a business’s existing workforce. However, there are some interesting points to note before moving into this topic further:

According to a study by Gartner, 86% of hiring managers expect external recruitment activity to decline for some positions. Unfortunately, this will likely come to fruition with a recession on the horizon. Employees are more likely to cling to their jobs for financial security during economic uncertainty. Generally speaking, workers aren’t as comfortable taking risks with their income, including accepting new job offers. 

However, freelancers have a different mindset altogether and, as a result, could be an attractive proposition for a company looking to invest heavily in building a freelance workforce to fulfill existing and future skills gaps. 

For example, it’s worth noting 31.4% of the global workforce are freelancers, with 60% specializing in more than one area and 64% saying no amount of money will entice them back to the traditional job structure. 

The bottom line for recruiters: Over the next few months, finding and securing new talent will be challenging. Rather than only turning your attention to upskilling your current workforce, it’s worth looking into the advantages of expanding your internal marketplace by proactively creating and growing your freelancer talent pool.  

What’s an Internal Marketplace?

An internal marketplace works wonders for organizing talent currently employed at your organization. More specifically, creating a comprehensive network of your talent pool's skills and experiences allows you to identify suitable people to upskill. The same goes for transferring workers onto projects where their qualities are needed. Think of it like an internal gig economy, where employees and freelancers can apply to work on assignments.

In short, an internal marketplace is where jobs are only posted within your organization (i.e., internally) and not made open to the public. Internal marketplaces are growing in popularity; according to LinkedIn, internal hiring rose nearly 20% during the pandemic. There’s an argument to be made that access to a regular pool of talented freelancers can also help businesses plug those skills gaps. 

In other words, businesses don’t have to limit themselves to their current workforce. It’s also worth maintaining relationships with a network of trusted freelancers, contractors, and former employees. With their permission, keep their details on hand so you can contact them if an appropriate project arises. 

In the case of freelancers, these can be accessed via a searchable live talent pool (aka a freelance management system). Employers can check a freelancer’s location, availability, pay rate, skills, and more. I.e., it provides instant access to a live workforce that can tap into whenever you need to plug skills quickly.

As you may have already guessed, successful internal marketplaces comprise two key components:

1. Worker profiles detailing their skills, aptitudes, and experiences

2. Project profiles outlining the skills needed for completion.

To help keep on top of things, you can use internal marketplace software to automatically match talent to projects based on an algorithm. While you can do this manually, a computerized system ensures hiring is swift and effective - especially if you have a large internal marketplace to manage. 

What Are the Advantages of Hiring Internally?

There are several perks to maintaining an internal marketplace:

• Higher Job Satisfaction. As we’ve already mentioned, internal marketplaces go hand in hand with upskilling and career development. As many as 74% of employees don’t feel they’re reaching their full potential because of a lack of development opportunities. On top of that, 41% consider opportunities for career advancement to be very important for job satisfaction. The moral of the story? You want to try and prevent staff from quitting their jobs to pursue better job satisfaction as a freelancer. In light of that, developing an internal marketplace where existing staff can shine and utilize/develop their skills to the fullest is a wise move.

   

• Save time and money: Staffing projects with existing employees or using freelancers and contractors you’ve worked with before can be cheaper for your business. Not least because you won’t spend as much time searching for talent or vetting new candidates, which, needless to say, reduces hiring costs. Some report it costs anywhere between six to nine months' worth of an employee's wage to hire an external employee, which is  20% more than hiring internally. Not only that but external hiring frequently takes a few months, which is too long if the role you’re trying to fill is for a project with an imminent deadline. In contrast, with an internal marketplace (in theory), you could assign someone to a task that same day! 

   

• Overcome skills shortages in a tight labor market. According to the European Labour Authority, there’s a 14% shortage in critical roles in over 19 EU countries and regions. A lack of skills for a new project can put your business at a standstill and slow innovation. But, finding potential talent amongst your own staff (even if that means providing training to upskill/reskill your team) enables you to react to skills shortages quicker. As we’ve already said, the hiring and vetting process associated with internal marketplaces is much faster, affording you more agility.

   

• Grant staff more autonomy. You can give employees the freedom within your internal marketplace to put themselves forward for projects they’re interested in. Not only does this give staff a greater sense of autonomy, but it's also excellent for boosting workplace satisfaction. Plus, your HR team has one less thing to worry about- win-win!

   

• Realize the potential of your talent. When employees join temporary projects, managers can see whether they have the skills/experience/aptitudes to work on similar projects that may have been overlooked. 

   

Internal Marketplaces: Their Challenges

Internal marketplaces might disrupt your reliance on freelancer marketplaces. As businesses start to look inward rather than outward, your relationship with freelancers might change. Rather than finding someone new for a project and cutting ties once the deadline’s been and gone, businesses may seek to establish longer-lasting contractor relationships.

With that in mind, below, we’ve listed a few challenges your business might face when adopting an internal marketplace into its hiring strategy:

• Teams must be open-minded and accepting of new opportunities. For internal marketplaces to function, businesses must encourage agility amongst their staff. This means managers should encourage their team members to seek new opportunities in other departments rather than hoping to keep them exclusively on their own team. It will take time for companies to adjust and abandon the rigidity they’re used to.

   

• Talent sharing has to become a cultural norm. As well as the attitude shift discussed above, you’ll need a process to help employees smoothly transition from one role to another. For instance, you’ll need to consider the following questions and have an action plan ready: How will you onboard team members into new projects? How will you cover their responsibilities in the team they just left? 

   

• Finding the right technology. There are only a few solutions that specifically serve the internal marketplace. Many businesses are building their own platforms or hiring internally through manual processes. That said, Bubty is a freelance management platform that can help you manage your talent, whether internal to your organization or external. You can create projects, assign skilled professionals, and create detailed profiles for workers that include their experience, skillset, and previous interactions with your business. Best of all, once you’ve concluded a project, you can add professionals to your freelancer network. That way, you have their details to hand should you wish to get in touch with them if their skills are needed again. 

The Internal Marketplace Is an HR Trend That Won’t Be Going Any Time Soon

In previous articles, we’ve explored how the gig economy is expected to grow. So it’s no surprise that establishing the same agility amongst internal talent pools that include freelancers is set to become a significant HR trend.

The bottom line: Internal marketplaces are undoubtedly on the rise. In fact, 80% of HR pros expect their firms to increase the use of internal marketplaces over the next five years, with 77% anticipating an increase in as little as 18 months!

These stats speak volumes. Adopting an internal talent marketplace into your talent acquisition and management process is vital for future-proofing your business to thrive in an increasingly tight and somewhat uncertain labor market.

Bubty is the best way to start establishing your own internal marketplace. It has all the tools needed for managing your workforce’s skills, organizing projects, and encouraging agile collaboration. Interested? Book a demo today to see how a freelancer management platform like Bubty could help.