The employer-employee relationship is being forged today in the crucible of multiple disruptive and technological advancements which while democratizing the skills and competencies world, has also brought to the fore constitutive laws that govern this relationship.
Going beyond the employment model, which we have always known, the new order is slowly shifting to the one driven by the dynamics of job availability, individual choices, skills and competencies. There are largely two ends to the gig economy spectrum.
One end of the spectrum happens to be the highly talented professionals who don’t take heart in being tied with a single organization, structured routine, and the day-to-day grind. They want to have the best of creative freedom and flexibility to explore the possibilities of working with multiple clients and various projects. They take pride in working according to their timelines and not some universal 9 to 5 coordinates and command a price that they think their expertise and experience deserves. Some of the finest examples for such workers could be a project designer, art director, marketing expert, business consultant, brand marketer, and others. Further expanding the spectrum, some of the roles which can fully be offered to freelancers are those which are about execution like content, social media, PR, SEO, customer relationship, sales, client services, and others.
The other end of the gig economy spectrum is professionals engaged in manual and repeated tasks which fall under some structured processes and have to adhere to some quality parameters. For instance, data mining, cleaning, creation and management. Such tasks could be outsourced to professionals depending on the requirements of project and role-specific engagements.
The gig economy is the bellwether of positive employment changes. Companies which are harbingers of the aggregator-based business models and subscription-based economy like Uber, Ola, Oyo, Flipkart, Amazon and Airbnb pushed the gig economy to another level and now every contract worker is a micro-entrepreneur in their own right. Uber and Ola together employ about 8 lakh drivers. The population strata that was out of employment coverage earlier like women and local artisans are now increasingly selling their products and handicrafts online. It could lift the female labor participation which has only recently fallen to 26% in 2018 from 36.7% in 2005. Around the world, from 2005 to 2015, the number of self-employed individuals soared by over 19%. A Bureau of Labor Statistics study states that it is already a reality in developed countries, where 55 million workers of their workforce are currently working independently.
The Flip Side
While all seems enchanting for now, there are also various implications presented by the gig economy which need to be sorted now rather than later. New HR processes and policies will delineate the boundaries of how much organizational data and information is shared with a non-employee leaving a vast room for inclusion of dark personality measurement inventory, behavioral and psychological assessments, background checks, and verification of the candidate. Since a non-employee is doing your work, what legislation do they fall under and how it impacts the bigger brand image and consciousness act as an Achilles’ heel to an otherwise positive trend. Recently, the California Senate passed the legislation to treat independent contractors like employees and that adds another catalyst to the already complex equation.
What’s in store for organizations?
Organizations are new to this space as well and experimenting with different ways freelancers could fit into their vision. From all employees being on-roll to the outsourced business model to the gig economy- organizations have come a long way. There will be tectonic shifts in interdepartmental collaboration and seamless communication for different people to work together. Owing to these developments, human resources will undergo drastic transformations. They will be engaged in a lot of new tasks which can be new-age realities of the modern organizational ecosystem in a few years. HRs will look into how many contingent workers are there, how to make their collaboration through systems, tools, and processes feasible. How technology and real estate solutions shape up such requirements are yet to be defined adequately.
Hiring freelancers, onboarding and engaging them is another code which needs to be cracked for a feasible gig and traditional work set-up. New tools and methods will come into the picture as online assessments, remote-proctored examinations, and video interviews become the norm rather than a novelty. A talent pipeline has to be built on various roles and their job descriptions through continuous skill and competencies measurement and assessments to ascertain whether or not they will be able to perform in a particular job. This data could be populated over several years to have a highly aligned and filtered talent pool data for future vacancies. Not limited to these, the performance management of gig workers and what benefits and compensation structure are planned for them- all such small but big-in-impact strategic decisions have to be concerned with as well.
Organizations are increasingly turning the gig economy to their benefit for diversified reasons, some of which are:
- Higher productivity, fresh ideas: Leveraging the focused, creative and motivated gig economy workers, organizations can scale up overall productivity. Moreover, as freelancers have extensive experience of working with various organizations, they bring in fresh ideas with their work. Freelancers working with multiple clients have expanded vision, thinking, and visualization for idea presentation, industry trends, and solution-based approach to market challenges. They are better able to comprehend what clients want and they need little to no hand-holding to come back with the task that requires no changes reducing back and forth interventions.
- Business agility: When considering the option of hiring gig workers, organizations can be more agile in scaling their workforce up and down quickly to meet business demands. A company's land and lease requirements will change and HRs have to wrap their heads around a new and transformed way of punch-in records. Depending on daily meeting requirements, room-availability will be marked and a new organizational construct built. It will be exciting to see how organizations become less about physical spaces and more about skills and availability.
- Time and cost-effective: Independent workers are usually highly qualified and willing to be deployed to complete clearly defined tasks. Organizations that hire them can do so for services as and when needed, only paying for the tasks which they complete. This translates into high time and cost efficiency, which results in bottom-line profits for companies, without compromising on the quality of work.
The gig economy is certainly creating new possibilities for engagement, workspaces, HRs, organizations, employees, and everything in between. It’s bringing more labor into employment. And the more people are employed, the more wealth is created- a positive aspect for the overall Indian economy. No wonder, India, which is already leading the global gig economy with a 24% share of the online labor market, is set to see exponential industry-wide growth with this trend.