Health and economic crisis triggered by novel coronavirus across the world is set to redefine business and social practices and bring in a paradigm shift in employing human resources.
Free movement of capital and labour as a factor of production will go beyond trade practices and government policies and not only turn local but rather hyperlocale, just like the revival of our next-door retail outlet over a shopping mall during the current crisis.
'Work from home’ culture, discovered during COVID-19 will enjoy a permanent status going forward aided by push to low-cost digital and high-speed internet connectivity.
In human resource parlance as per the Pareto principle of 80:20 rule, which means 80 percent work is done by 20 percent people and vice-versa would also undergo a radical change with a greater push to gig economy to my mind.
Gig economy can be defined as a work engagement for a specific job and paid on assignment basis rather than a fixed salary, which is a shift from the conventional 9-to-5 job to a freelance, task-based work.
According to a report by industry body Assocham in January this year, India’s gig economy is projected to grow at a CAGR of 17 percent to 455 billion U.S. dollars by 2023.
With rampant job-losses and salary cuts following the nation-wide lockdown due to the novel coronavirus crisis that provides a bouquet of investment, credit and insurance services among others, have seen a rising interest from gig professionals.
The concept of disguised employment heard only in the agriculture sector in the past has also found its way into the corporate world in the past few decades. Disguised employment is a type of employment in which more workers are employed than the amount that is actually required. This system is also called 'hidden employment’ or popularly called in the information technology sector as bench strength.
Mapping of work and productivity per employee will more stringently be captured without any cross-subsidy for some one lethargic against those who are efficient. Retaining talent will be equally challenging for organisations, as rewarding them, given the economic spectrum will be far from easy.
From a macroeconomic perspective, the shift in manufacturing base within the Asian countries towards India, Vietnam and Indonesia and redefining of the consumption and demand pattern top three fastest growing Asian economies led by Japan, China and India would need a rejig of the working apparatus of several large conglomerates in these economies.
With the digitalization of several economies, the old norm of urbanization drives growth will also take a back seat as labour at the low end of the spectrum may tend to reverse migrate to rural areas to focus on the primary activity of agriculture as the service industry touches a new low with better bandwidth and faster internet.
Given the evolving scenario, we believe that the Gig economy will see faster growth and act as a game changer for human resources for companies and industries that bank on skill-based service and consultancy activity. The same may be true for manufacturing activity, in the name of outsourcing. Human resources as a work force may never be the same again, after the COVID-19 disruption.