A gig economy is an environment in which
temporary positions are common and organizations contract with independent
workers for short-term engagements.
The trend toward a gig economy has begun. For one
thing, in this digital age, the workforce is increasingly mobile and
work can increasingly be done from anywhere, so that job and location are
decoupled. That means that freelancers can select among temporary jobs and
projects around the world, while employers can select the best individuals for
specific projects from a larger pool than that available in any given
area.
Digitization
has also contributed directly to a decrease in jobs as software replaces some
types of work and means that others take much less time. Other influences
include financial pressures on businesses leading to further staff
reductions and the entrance of the Milennial
generation into the workforce. The current reality is that
people tend to change jobs
several times throughout their working lives; the gig economy can be seen as an
evolution of that trend.
In a gig economy, businesses save resources
in terms of benefits, office space and training. They also
have the ability to contract with experts for specific projects who might
be too high-priced to maintain on staff. From the perspective of the
freelancer, a gig economy can improve work-life
balance over what is possible in most jobs. Ideally, the model
is powered by independent workers selecting jobs that they're
interested in, rather than one in which people are forced into
a position where, unable to attain employment, they pick up whatever temporary
gigs they can land.
“The gig economy can be used in a range of roles,
whether it is junior admin roles and hospitality right up to highly skilled
workers, developers and designers and marketers,” he says. “It’s also valuable
at the executive level – CFOs, CTOs can be really effective on a gig basis as it’s
an opportunity for organisations to bring in intellectual property (IP) if the
business is lacking in a certain area.”
This trend is already underway within recruitment
sector. Senior people with experience of working in large companies into
smaller companies for short periods, in order for the company to absorb their
expertise.
Interestingly, these ‘interim executive
solutions’ are proving to be a disruption, less to permanent work, but more in
the management consultancy space. As clients become more aware of the
possibility of engaging very high-calibre talent for short time spans, this
represents a significant opportunity for recruiters.
The gig economy is part of a shifting cultural
and business environment that also includes the sharing
economy, the gift economy and
the barter
economy.
Why
is it happening now?
People joining the workforce now
have a different mindset from the past. People are looking for experiences and
growth, and the need for stability is not so ingrained.
Gribble believes the move towards shorter-term roles is also being driven by specialisation.
Twenty years ago, professionals were generic. These days, market is demanding more specialist and niche skills. But companies can’t employ people with all the niche skills required, as they’d just have too many people.
While the perception of short-term roles may have changed in recent times, the idea of hiring employees for short-term roles isn’t new – what’s new is how we go about it.
Previously if you wanted to call a taxi, you’d call a taxi company and if you wanted to buy goods you’d go into a store. What has enabled the gig economy in the format that everyone is now talking about is the rise of technology.
Technology and its intermediation power has meant that buyers and sellers for hirers and service providers can directly connect.
Gribble believes the move towards shorter-term roles is also being driven by specialisation.
Twenty years ago, professionals were generic. These days, market is demanding more specialist and niche skills. But companies can’t employ people with all the niche skills required, as they’d just have too many people.
While the perception of short-term roles may have changed in recent times, the idea of hiring employees for short-term roles isn’t new – what’s new is how we go about it.
Previously if you wanted to call a taxi, you’d call a taxi company and if you wanted to buy goods you’d go into a store. What has enabled the gig economy in the format that everyone is now talking about is the rise of technology.
Technology and its intermediation power has meant that buyers and sellers for hirers and service providers can directly connect.
Limits
of the gig economy
Gig economy will never replace permanent work, as
people will always value the security and longevity that permanent employment
can bring. “Permanent employment will continue to thrive where there
is a match of company values with that of the employee, and where it’s
perceived to contribute to their career development and progress."
‘When you find a good company, you want to stay with it. Often after a period of time contracting, people desire that ongoing connection with a culture and this can be limited with contract workers.”
Gig economy comes at the point where expert internal knowledge is paramount for the role. “There is still a huge need for robust full time, part time and casual employment. The main reason for this is because businesses are crying out for talent and they want to hold onto as much IP as possible.
Workforce are being supplemented by gig workers, who either deal with skills shortages or supply shortages of labour. The growth of the gig economy also has the potential to impact on the skill levels and career development of workers.
Of course, contract workers always have the possibility to impress a company to get more work, or even permanent work. If your ambition is to manage large teams of people, the gig economy can serve as a ‘between’ job. But employers will assess your success as a manager over perhaps a three year period, rather than three months.
‘When you find a good company, you want to stay with it. Often after a period of time contracting, people desire that ongoing connection with a culture and this can be limited with contract workers.”
Gig economy comes at the point where expert internal knowledge is paramount for the role. “There is still a huge need for robust full time, part time and casual employment. The main reason for this is because businesses are crying out for talent and they want to hold onto as much IP as possible.
Workforce are being supplemented by gig workers, who either deal with skills shortages or supply shortages of labour. The growth of the gig economy also has the potential to impact on the skill levels and career development of workers.
Of course, contract workers always have the possibility to impress a company to get more work, or even permanent work. If your ambition is to manage large teams of people, the gig economy can serve as a ‘between’ job. But employers will assess your success as a manager over perhaps a three year period, rather than three months.
