The adage ‘necessity is the mother of invention’ found its application in the disruption brought in by COVID-19. But before we get into what transpired in the last two years, let us understand what the gig economy looked like before the whole world masked up.
Part-time work has always been around us, but the potential to scale was marginal, and enterprises offloaded little of their business operations. The most prevalent sectors to engage with gig partners were ride-hailing services, e-commerce, logistics, and with sporadic opportunities, gig was perceived more as a part-time source of income. Cut to December 2019, the world woke up to the news of a virus, understanding little of the massive disruption and economic impact it was set to unravel on the globe at large. While we rushed to protect our immediate health and that of our family members, the pandemic ushered in a new era of online social interaction on both fronts - personal and professional.
Of challenges and solutions
The pandemic compelled people to see the unpredictability of life and the importance of devoting time to aspects other than work. It made them reconsider their life priorities, quit their full-time jobs, and move to freelance for a better work-life balance. In fact, the attrition rate in India across sectors went up by 21% in 2021 compared to 12.8% in 2020!
The pandemic also forced millions of employees to relocate, eliminating job security, increasing the need for additional finances, lack of motivation et al. All these culminated into people across skill sets, demographics, and geographies to consider and ultimately adopt the gig culture.
On the other end of the spectrum, employers too scrambled under pressure as offices were closed and attrition was at an all-time high. In a bid to stay afloat, businesses became receptive to the idea of hiring freelancers on a gig-to-gig basis. As the avenue of scaling up operations exponentially and faster while lowering operational costs, gig came to the rescue for enterprises across the spectrum. It not only helped in maintaining their company margins, which were already strained by the economic slowdown, but gig partners also provided employers with the convenience of quick hires on term contracts. Enterprises thus welcomed the cost savings and reduced the stress arising out of the rigmarole of acquisition, hiring, and onboarding of talent on a fixed payroll.
The current state of affairs
The pandemic sure changed the tide - what was once perceived as sporadic hiring, the gig culture prompted changes in business strategies. Two years since the world woke up to COVID-19, forward-thinking enterprises today no longer concentrate on full-time employment but rather have their energies focused on having access to the right people! Here’s what evolution today looks like.
Joining the gig bandwagon, 84% of talent managers in APAC - the highest in the world - are known to have hired gig partners, and around 50% of projects with startups, major corporations, and professional services have indicated strategy, technology, and marketing as the top three talents in demand. Infact, 49% of Indian companies are actively engaging in gig model, as a flexible capacity scale-up and cost reconstitution model. In addition to last mile delivery, core non-technical work such as invigilation, proctoring, business development, audits, to expert roles such as engineering manager, and software developers are being gigified.
The benefits of this outcome based work is visible in the profits too. With companies not only hiring freelancers for entry-level positions, but also for management positions, CFOs have helped increase operational savings by up to 70%.
From ‘option’ to ‘preference’
It is not just the two primary stakeholders - the employers & employees, but the polity has also recognized the potential of the gig economy. Through the pandemic, measures such as code on social security, mandatory coverage under the Bharat Pradhan Mantri Jan Arogya Yojana, Pradhan Mantri Suraksha Bima Yojana, and Pradhan Mantri Jeevan Jyoti Bima Yojana, have been introduced to proffer gig-benefits and safeguard the interests of gig partners. Add to this the infusion of robust tech infrastructure and the advent of work-tech platforms, we suddenly have an otherwise informal sector streamlining itself.
So even though the pandemic pivoted the gig economy, the gig culture is here to stay even long after the former has moved out of our lives. In the next two to three years, the gig economy could create millions of new jobs and provide a living for Indians in their field of expertise. It is past time for all skilled professionals to adapt to gig work, and enterprises to view the ecosystem as a means to quantifiable outcomes, as it will become the new normal in the future.