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Do More with Less: Leveraging Fractional Work in Human Services Amid Budgetary Constraints

Updated: Jun 12

Companies in all sectors are facing the need for cost-cutting efforts due to the current economic realities. Mass layoffs and downsizing have become almost daily topics on LinkedIn. For human services organizations, who already operate with a lean infrastructure while caring for a very vulnerable population, this can be especially problematic. The Behavioral Health (BH)/Intellectual & Developmental Disabilities (IDD)/Autism space is significantly impacted by rising costs, increased demand for services, staffing shortages and the potential increase of un- or underinsured individuals due to job loss. Under these circumstances, what do you do as a leader when you have significant work that needs to be done but no budget for a full-time employee?

Fractional work can be a cost-effective solution for providers. Typically done as contract work (with the caveat of ensuring the work meets the standards for 1099 contractors from the Department of Labor), fractional work enables organizations to move forward with critical initiatives while managing cost. Unlike general freelance agreements which are usually project-based, fractional arrangements typically involve ongoing, yet shorter-term, engagements, such as working a few days per week or a set number of hours per month for a designated period of time.

Benefits to organizations include:

1. Cost-effectiveness: Hiring fractional workers can help reduce costs compared to full-time employees. These contracted positions work fewer hours without benefit expenses, such as healthcare and retirement plans, which can significantly reduce the overall expenditure. Seeing that the salary range (not including benefits) for a project manager alone is between $60-$80k, a fractional agreement could yield necessary outcomes with substantial cost savings.

2. Specialized expertise: Professionals who provide fractional work often possess specialized skills and expertise in their respective fields. Some will have extensive, broad experience that can be used across various departments/projects versus hiring multiple part-time or full-time staff. By contracting with these professionals, you can tap into this talent pool without the need for long-term costs or extensive training.

3. Reduced burnout for employees: In tough economic times that necessitate cost-cutting, existing employees are often expected to shoulder additional tasks/responsibilities. Adding more work to already full plates can negatively impact morale, productivity and employee wellness. In fact, a survey conducted by the National Council for Mental Wellbeing (in collaboration with the Harris Poll), revealed that 93% of behavioral health workers have experienced burnout, and 62% report suffering from moderate or severe levels of burnout. Nearly half (48%) say that the impacts of workforce shortages have made them consider other employment. By outsourcing some of the necessary, but time-consuming, tasks/projects, you can allow your key employees to focus on their core responsibilities while also maintaining a healthy work-life balance.

4. Increased productivity: Fractional workers are generally highly motivated and committed to delivering results within the limited time they are hired for. They are incentivized to get the work done quickly and well due to client satisfaction and positive feedback being crucial to gaining future business. They also do not have the distractions of the day-to-day pulling attention away from the task at hand. Their focus on achieving specific goals can lead to increased efficiency. Additionally, their specialized skills can help streamline processes and enhance overall performance, making them valuable contributors to the organization despite their temporary status.

5. Reduced administrative burden: Hiring fractional workers can reduce the administrative burden associated with supplies (computers, etc.) and HR tasks, such as payroll management, benefits administration, and employee onboarding. A Society for Human Resource Management (SHRM) study estimated the average cost of employee onboarding alone is $4100 per new hire. Since traditional, full onboarding is not necessary, and contractors handle their own taxes, benefits, and contractual obligations, the organization's administrative workload and cost is significantly reduced. This administrative efficiency can be advantageous during times of budgetary constraints when streamlining processes becomes crucial.

Fractional agreements can be extremely beneficial to BH/IDD/Autism providers in the current landscape, but, like everything else, are not a one size fits all. Our next blog post will be on how to select and define the work for a fractional executive to get the most out of the arrangement.

Want to know more about whether the fractional work Virtue provides is a fit for what you need? Set up a meeting with us to discuss!


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