Australia’s banking and finance sector is experiencing major workforce challenges.
What does this mean? With an annual turnover rate of 10-15%, organisations are facing difficulties in retaining skilled workers. At the same time, many financial institutions struggle to meet rising demands for seamless digital services while managing regulatory pressures and cybersecurity threats.
These pressures make it harder for businesses to stay agile and competitive with a permanent workforce alone. Thus, many companies are adopting more flexible workforce strategies to address these issues. One solution gaining traction is using a contingent workforce, which allows organisations to bring in skilled professionals on a temporary or contract basis. This approach helps businesses manage periods of high demand by being able to respond swiftly to sudden market changes.
But what does managing a contingent workforce really mean, and how can it help Australia’s finance sector solve some of its biggest problems?
Addressing workforce challenges through managing a contingent workforce
Here are some ways managing a contingent workforce can address key challenges Australia’s finance industry faces.
Skills shortages and accessing specialised talent
The skills shortage in Australia’s finance sector is a critical issue. As The Chartered Accountants Australia and New Zealand (CA ANZ) highlighted, shortages across key roles like accountants, auditors, and finance managers have made it difficult for companies to fill positions.
Plus, an ageing workforce, limited migration due to COVID-19, and declining accounting graduates have worsened the situation. As a result, this shortage increases recruitment costs, delays digital transformation, and pressures existing staff.
Thankfully, contingent workers offer a solution by filling these gaps. For example, if a bank needs cybersecurity experts for a system upgrade, hiring temporary specialists allows them to address immediate needs without committing to long-term payroll and overhead costs.
This is where specialised workforce solutions can make a significant difference. As demonstrated by our work with Australia’s leading energy retailer, we at CXC excel at managing large contingent workforces for global companies. Our expertise in quickly sourcing and onboarding specialised talent can help Australian finance organisations swiftly fill critical roles like accountants and cybersecurity experts.
Regulatory compliance and risk mitigation
In the finance sector, staying on top of regulatory compliance is critical. With frequent changes to Australian laws and regulations, companies must remain compliant to avoid fines or damage to their reputation. However, the pressure to maintain compliance can burden permanent staff, who may already be stretched thin.
Banks and financial institutions can more effectively manage these demands by bringing in contingent workers with specific regulatory knowledge.
Our expertise in compliance, combined with our CXC Comply platform, makes us an ideal partner for finance companies needing to mitigate regulatory risks. Our deep understanding of local labour laws and international regulations ensures contingent workers are engaged compliantly.
For instance, a finance company preparing for an audit could work with us to quickly source and onboard a short-term regulatory consultant, leveraging CXC’s compliance tools to ensure the specialist’s proper classification and engagement.
Economic fluctuations and the need for workforce flexibility
The finance industry is especially vulnerable to economic ups and downs.When the market fluctuates, so does the demand for workers. Hence, maintaining a permanent workforce during periods of economic downturn can be expensive—leading to layoffs, low morale, and even financial instability within the business.
Managing a contingent workforce allows businesses to scale up or down as needed. If demand spikes due to market conditions, companies can hire additional temporary workers to help manage the workload. Conversely, if business slows, they can reduce their workforce without laying off permanent staff.
This flexibility allows finance companies to stay agile, adapt to market changes, and control costs without the stress of restructuring their workforce.
Reducing overhead costs with contingent workers
Another significant benefit of contingent workers is the cost savings. As mentioned above, maintaining a permanent workforce comes with significant overhead, including salaries, benefits, training, and long-term commitments. In contrast, contingent workers are typically paid for the duration of their contract, meaning businesses can avoid the long-term costs associated with permanent employees.
For example, a financial institution that regularly launches new products may need marketing professionals with specialised skills for each launch. Hiring a permanent team for each project can be costly, especially if those skills aren’t required after launching the product. Instead, the company can hire contingent workers for each project, saving money in the long run.
Engaging and managing contingent workers effectively
While there are clear benefits to using contingent workers, managing them effectively can be challenging. What are the challenges in managing a contingent workforce? These include:
- Ensuring compliance with labour laws
- Integrating contingent workers into the company culture
- Maintaining clear communication and expectations.
Additionally, businesses must ensure contingent workers are correctly onboarded and have the necessary tools to be productive. Unlike permanent employees, contingent workers may not be as familiar with the company’s culture, processes, or expectations. Therefore, businesses must invest in proper onboarding and communication for the best results.
One way to engage contingent workers is to treat them as an integral part of the team, even if they’re only there for a short time. Providing clear goals, regular feedback, and opportunities to collaborate with permanent staff can help ensure that contingent workers are productive and aligned with the company’s objectives.
To further enhance the effectiveness of engaging and managing contingent workers, companies can implement more structured approaches:
- Establish a centralised system to inform contingent workers about internal positions and projects.
- Offer training and upskilling opportunities to help contingent workers expand their capabilities.
- Facilitate connections between contingent workers and regular staff to encourage knowledge sharing and career guidance.
- Implementing a structured feedback system to ensure contingent workers receive constructive input on their performance.
The future of managing a contingent workforce in finance
The future of Australia’s finance industry is likely to see even greater reliance on contingent workers. As the sector evolves with new technologies, regulations, and market pressures, businesses must remain agile and adaptable. Managing a contingent workforce effectively allows financial institutions to address skills shortages, control costs, and maintain competitiveness in an ever-changing environment.
Looking ahead, contingent workers will continue to play an increasingly important role in the finance sector—providing the flexibility needed to respond to market fluctuations, regulatory demands, and operational challenges. Whether it’s filling skill gaps during digital transformation or scaling staff levels to meet immediate business needs, contingent workers will continue to be a vital resource for the industry.
CXC is more than ready to support your organisation in implementing effective contingent workforce strategies. If you want to stay ahead in Australia’s dynamic finance sector, contact us today to learn how we can help you build a more flexible and skilled workforce.
Additional critical information on contingent workforce for the finance industry in Australia
What are two categories of contingent workers?
Contingent workers generally fall into two categories. Independent contractors are self-employed individuals who provide services to a business for a specific period or project. On the other hand, temporary agency workers are hired through an agency and typically work on short-term assignments for the company.
In Australia, though, there are several types of contingent workers:
- Temporary workers: Short-term hires through agencies to fill immediate needs.
- Consultants: Specialists who provide expert advice temporarily.
- Independent contractors: Self-employed individuals hired for specific projects, including freelancers and gig workers.
- Fixed-term contract employees: Employees hired for a defined period, with benefits similar to those of permanent staff.