The Number of Fractional Jobs Openings for CEOs, CFOs, CMOs, are Increasing in 2024
(Part 1 of 2)
You’ve probably heard of a Fractional CXO by now. Since 2016 the term Fractional CXO (CEO, CMO, COO, or CFO) has seen an exponential boom in the world of business and hiring. This concept is popping up all over job boards, LinkedIn profiles, and even recruiting services.
Temporary business management or fractional jobs were up 18% from 2021 to 2022 and 57% since 2020. (Source Bureau of Labor Statistics) And since 2020 there has been an even greater uptick in the demand for fractional services.
Companies across the US and abroad are seeing the value of hiring fractional executives and more, to provide specialized expertise without committing to a full-time hire. This trend is driven by the need for cost-effective solutions and a desire for more flexible leadership models. Often it can serve as a less risky trial period for both parties to see if a longer-term engagement is in the cards.
Here are some reasons behind the increased demand for Fractional Executive jobs:
1) Start-Up Boom
In 2021 there were 5.4 million new businesses filed in the U.S. according to the Census Bureau’s Business Formation Statistics, a 53% increase in from 2019. One reason for this, according to The New York Times, is that the federal government stimulus gave individuals the extra capital they needed to invest in new business ideas. Start-ups who could never afford to hire experienced executives are leveraging fractional jobs for strategic leadership at a portion of the cost.
2) Normalization of Remote Leadership and Virtual Work
There has been a mass acceptance of remote work due to the COVID-19 pandemic extended to fractional executives, with many providing leadership in a virtual environment. The business world has become comfortable with remote management, Zoom communications, and virtual teams.
3) Increase of Specialized Project-Based Jobs
Project-based engagements are on the rise which can be a perfect fit for the Fractional Executive. Fractional CXOs are often engaged in specific projects or initiatives, such as market entry, product launches, or process optimization. Organizations often seek expertise in narrow vertical markets, a technological launch or function, or somebody with specific management experience.
With access to national, virtual hiring platforms companies can recruit from a wider pool of talent for specific project needs. It can be more cost-effective and risk-averse for a company to pay a premium for that expertise area at a Fractional rate vs. that of a full-time employee who would be responsible for other areas of management.
4) Highly-Skilled Management Needs
Fractional CFOs and CMOs with expertise are among the most sought-after hires. For CFOs desired skillsets that include financial management and capital raise expertise. CMO fractional jobs see the experience of marketing strategy and digital marketing in high demand. Many fractional executives, including CEOs, offer coaching and mentorship services, providing additional value beyond their core executive roles.
5) Fractional Jobs are Lower-Risk Capital Investments for Companies
In today’s volatile capital markets companies are having issues forecasting beyond a quarter or two. Interest rates are high and there is less long-term equity from investors. Fractional work allows companies to plan on a shorter-term basis to see if planning and projects pay off before a deeper investment.
As an employee does it make sense to take up fractional work while you are in between jobs? How do you start a fractional business? What does it entail? Read our next article as we discuss the pros and cons of taking on fractional work as a senior-level executive. Fractional CXO Jobs Are Everywhere. Are They Right for You? (Part 2 of 2).