2020 and the Gig Economy

It is startling to think that when we fling ourselves across the finish line of 2016, we will land a mere 3 years away from 2020. Many predictions have been made for that momentous year. At a distance of 36 months, we should be able to sift at least some of the accurate information from the urban myths, including the ones about why people participate in the ‘Gig Economy’.

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The ‘Gig Economy’ is a system in which project, short term and temporary assignments are common and organisations scale up with independent workers as they need them for focused and clearly defined assignments. This can refer to anything from driving team members safely home after a staff Christmas party or hanging decorations in reception, to conducting a major review of the performance management system.

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The effective use of mature and experienced resources as and when companies need them makes sense in terms of the country’s productivity, and for organisations managing their workload as a series of projects. But what about the independent workers themselves? What is in it for them? There is a common perception that individuals take on part time / contracting roles / gigs for one of only two reasons:

  1. out of necessity (when they are unable to find fulltime employment); or
  2. because they are able, by nature or fortunate financial circumstances, to take the risk of not having regular income.

Accurate figures and predications in this area are hard to come by. This is partly due to the fact that individuals in this category may label themselves as permanently self-employed, rather than as workers who contract or freelance. The figure for Australians who say they work as independent contractors has in fact been in decline over recent years, while the figures for people who claim to be employed part time has increased slightly.

The line between “gigs” and “jobs” is becoming blurrier as some gigs now offer more perks and there is a trend towards shorter employment terms in traditional jobs. It would be wrong to assume that a permanent contract equates to an indefinite one (if you are an employee) and that you can’t get optimal levels of commitment and productivity out of contractors (if you are an employer).

What Motivates People to Enter the Gig Economy?

While we have spoken before about the move to a more fluid workforce, very little research has been done on the topic of what motivates individuals to work as independents. It was therefore interesting to see a recent report* based on research by McKinsey, highlighting four distinct categories within this part of the workforce. You might assume that this is a space reserved for people who can’t find permanent employment, but you’d be wrong. As you can see from the information below, upwards of 70% of respondents are “gigging” because they want to:

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This paints a much happier picture than one might expect. Free agents are reportedly even more satisfied with this way of working than individuals who work in more traditional ways by choice. They also show higher levels of engagement and appreciate a greater sense of autonomy and control of their time. Interestingly, they feel no worse off than traditional workers in terms of financial security and benefits.

“Most independent workers have actively chosen their working style and report high levels of satisfaction with it.”

McKinsey

 

The research also established that many people not currently working within a more traditional employer-employee relationships would prefer to ‘gig’.


Source:
* McKinsey Global Institute, 2016