What’s Your Strategy for Leveraging the Gig Economy? Do You Have One?

The gig economy is really nothing new, although the term itself and the rapid growth in the number of companies that are hiring remote staff is definitely on the rise. In truth, though, companies have been using gig workers—otherwise known as contractors, freelancers or outsourced talent—for many years. But technology advances, coupled with the growth of organizations like Uber and Lyft, and changing work perspectives and preferences among younger generations, have widely popularized the concept and made it a game changer for employers.

What is the Gig Economy?

Put simply, the gig economy represents workers who wish to work for multiple employers, or clients, through “gigs” rather than committing to a single employer. The concept holds benefits for both employees (freedom and flexibility) and employers (ability to work with hard-to-find talent that may not be available locally, minimized long-term risk). It’s a trend that is not likely to slow anytime soon and one that HR professionals can leverage to their companies’ advantage if they take a strategic, rather than situational, approach.

Most frequently, gig workers or contractors are considered when a last minute, urgent need demands attention and in-house talent isn’t available to take on the assignment. Increasingly, though, the use of gig talent represents opportunity for HR pros and organizations to think differently—and more innovatively—about how to address staffing needs.

Susan Haberman, US career business leader with Mercer, says that according to Mercer’s 2018 Global Talent Trends Study, 40 percent of HR executives plan to increase the use of contingent, freelance, contract or temporary labor in 2018.

Technology Driving Demand

FitSmallBusiness.com recently conducted a study identifying the highest paying gig economy jobs of 2018. Not surprisingly, most are related to new technologies.

Laura Handrick, HR analyst with FitSmallBusiness.com, says, “Innovation opportunities and technology needs are requiring HR to seek alternative solutions to getting work done. Rather than hiring, training, and ramping up an employee for a project, it’s simply much more efficient to hire a gig worker who already possesses the desired skills.” An added benefit, Handrick asserts, is that because gig workers can come from anywhere, don’t require benefits and can be onboarded and offboarded more quickly, the company can save money in the process as well.

“HR leaders should be evaluating their entire workforce for the future and considering when, where and how gig workers will play an important role in their success,” says Haberman. “Having a strong, well-developed workforce plan has never been more important and will require employers to fully consider when to buy, build and borrow talent.”

Thinking Strategically About the Gig Economy

Karrie Sullivan serves as a Chief Transformation Officer for client companies that are facing challenges with finding or developing staff to stay on top of disruptive trends that require them to effectively respond to a rapidly changing environment. Gig workers can, and do, help to fill this gap, she says.

How companies approach the gig economy, Sullivan explains, “depends on where the company is in its growth and where the industry is relative to change and disruption.” Currently, Sullivan is working with some companies to determine how they can leverage Artificial Intelligence (AI) to address staffing challenges.

When these types of new opportunities or challenges emerge, she says, “We work through organizational structure, talent needs and retraining to better leverage the staff they have.” But, Sullivan adds, “Sometimes growth, change, and/or disruption means the company needs people with specific skills to help build the next stage, or people with different skills to maintain a function.” That’s where considerations of the gig economy may come in, as well as considerations of how technology—like AI—could address staffing needs.

For her part, Handrick suggests considering how gig workers could augment the workforce as part of a company’s annual planning. “As HR leaders strategize with key business stakeholders about upcoming positions and work that needs to be done, they can bring to the table the option of hiring gig workers to outsource key tasks,” she says.

“In addition to planning how many FTEs will be needed each quarter, or year, HR now needs to be much more granular in working with department heads to determine the exact kind of work product that needs to be sourced.”

Deb Seeger is senior vice president and co-founder of Patina Solutions, a talent staffing services firm in Brookfield, Wisconsin. HR leaders today, says Seeger, are approaching staffing needs with a “build, buy or borrow lens.” Increasingly, organizations are “asking when is it best to buy or hire for roles and positions,” she says. “And, importantly, they are considering when to borrow talent in this gig environment. That means leveraging agile talent on demand, consultants and temporary employees. Each has clear advantages for an organization to consider.”

Of course, one of the ongoing challenges of the gig economy involves the underlying questions and challenges of ensuring that employees are correctly classified. XpertHR’s Marta Moakley addressed the issue recently, pointing out the promise that blockchain may hold. What’s certain is that as these technological breakthroughs continue, new questions for the gig economy will be raised as well.

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