Gig Economy – Threat or Opportunity
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Gig economy or the shared economy is fast becoming a force to reckon with in the technology market. Although Gig economy has a lot of advantages – flexible working, new opportunities for the unemployed and increased productivity for firms and the “giggers” together, it can also lead to problems like job insecurity and low income for the “giggers” and increased competition and attrition of the inhouse talent pool for the firms.
2017 has already seen a growth in the freelance economy that employs almost 55 million Americans or about 35% of the nation’s workforce—a figure expected to grow to 40% by 2020. The Deloitte 2016 Global Human Capital Trends report revealed that 51% of executives plan to increase or significantly increase the use of contingent workers in the next three to five years, while only 16% expect a decrease. However, the recent Deloitte 2017 Global Human Capital Trends found that 53 percent Business leaders reported weak capabilities in the gig talent pool.
This brings about a paradoxical dilemma for any company. Today’s employees do not assume steady and increasing income nor do they look forward to a secure job and the associated economic compensations. They are more focussed on a diverse work portfolio with flexibility, autonomy and enhanced personal skills. This provides an employer with a global yet untapped avenue to source niche skills that might not be required on a full-time basis and thus shift the labour costs from fixed to variable often contributing positively to the company’s financial position. However, it is not short of pitfalls starting with the unreceptive corporate culture and lack of managerial understanding to various legal and regulatory uncertainties.
Deloitte had already predicted the growth of the “Open Talent Economy” much before the gig economy had consolidated its position. What is needed right now is to build upon all the research that has been put together, actively scout out talent in the vast talent pool available in the market and integrate them into the organization. This holds true especially in the younger generation which values creativity and independence over security and paybacks. Freelancing is no longer considered the last resort of the unemployed but rather the “badge of honour” for the multi tasker. It also pools together the experience of the “retired” who have been marginalized in the current economy.
This transition is not easy to incorporate