Top 3 ways the Gig Economy will impact future hiring

Last decade, the working industry saw a massive decline in the number of permanent employees globally. The main reason behind this is the shift in the cultural perception of the modern generation that is more bent towards freedom of tasks, time and tenure. This culture is slowly gaining a strong portion in the professional market, known as the Gig Economy. Gigs, also known traditionally as projects, are becoming more abundant every year. The behavior of the new generation with respect to taking short term projects over fixed employment is evolving faster than expected.

Even though the Gig Economy is still in its infancy, the growth can be tremendously fast, especially in 2020. Modern generation, also known as Generation Z, will become the majority of working population in the coming years. According to CNN, the Gig Economy covers 34% of the workforce in the US, with a prediction of growing to 43% by 2020.

Till now, the organizations require commitment of a fixed 9-5 employee by owning the skill of that individual, and by using it the way they feel suitable. The vision of employees when aligned with that of the organization, helps bring better outputs and builds long-term relationships.

In return, the organizations help employees grow in their careers, provide health & lifestyle benefits, and enable the privilege of paid leaves. However, the thought that a job is secure for a lifetime is not secure in itself anymore. While the transitioning generation which ranged between 1990 and 2010 accepted this fact, the next generation is in denial of commitment caused by job insecurity.

With a change in the collective thought of millennials, organizations will need to adapt themselves to a more flexible and modern workforce culture to retain permanent employees. The Gig Economy is going to impact future hiring, where gig workers prefer flexible work timings, output-oriented projects, self-managed leadership, and individual growth on every project completion. These preferences will require certain changes to make both the organization and the professional meet halfway in compliance.

Gig Economy workers usually do not work in offices. They may work from their home, from a cafe, a co-working space or even while traveling. This is the benefit that attracts more of the new generation rather than the older one. While you may have employees who believe in physical workplace presence, managerial level professionals will need to find remote control options for the gig workers.

One of the advantages to organizations is the detachment from providing paid leaves, entertaining health & personal benefits, and other permanent employee privileges. While gig workers usually charge higher for the projects, the result of project base expense can actually lead to long-term benefits for the business. Taking charge of this benefit, many organizations are already building mutual benefits for gig workers to attract higher quality, faster.

Thinking about policies, systems, and processes; HR will play a vital role in defining how the organization reaps benefits from the Gig Economy. By devising temporary employment strategies that would attract gig workers, organizations can improve their performance while enjoying multiple benefits

Having a large workforce of permanent employees is steadily becoming difficult. To attract those who are still in compliance with the old set of employee rules, the HR will require to streamline the concept of ‘employee first’.

Maintaining a quality talent pool will soon require HR to ensure that the environment is beneficial for both permanent and gig workers. Today, most of the employees who are working in permanent jobs, have one or more side gigs in place already. If the work environment is not friendly enough to support the balance in their lives, they may shift faster to being full-time gig workers.

Most of the organizations have kept business growth as the primary motive until now. But, in an era that involves professionals who look for synergic growth with the organization as their reason to onboard themselves, the perspective of the organization needs to rapidly transform. A business that supports its employees’ growth as much as its own in the form of promotions, privileges, rewards, and increments will enjoy a better talent pool in-house.

Primarily dependent on technology, the Gig Economy impacts future hiring with the increase in accessibility of businesses over mobile phones, contracts, interviews, hiring, deliverables, and even payments, becoming easier. To successfully enroll gig workers to your projects, the HR needs to become tech-savvy. This will surely increase the burden on HR teams, but can be beneficial as well.

Automation is one aspect that can benefit HRs in making their work management easier while ensuring optimum quality and timely deliveries. OCR and other online tools can also help fasten the process while reducing manual paperwork.

This will give more time to HRs to manage the new-found workforce of the Gig Economy efficiently. Not only will it leave more breathing space for the HR managers, but it will also enable the executives to handle the tasks better in terms of quality, quantity, and timelines.

Currently, the Gig Economy is in its stage of infancy. It was the industrial revolution that drove the global population to seek permanent and regular income through jobs. Before that, contract-based work was abundant worldwide. The main reason behind people turning up for everyday jobs was commitment and regularity of lifetime income.

But, the new generation, though still working full time, is absorbing the temporary job concept fast. The Gig Economy is divided clearly in the form of an hourglass. While skill-based gigs like technical development, creative tasks, marketing, and advertising are on top of it, the other side is targeted on people simply looking for some income. It can include delivery personnel, aggregators, sales executives, and even rental drivers. The best use case for this is Uber, which has a majority of its workforce on contractual terms. All that one needs is a driving license and a vehicle to start working for such businesses.

As much as this may seem supportive of the lower end of the workforce, it also comes with its backlogs and risks. The first backlog is the lack of permanent employee benefits which include regularity and safety. While on one hand, a cab driver can earn more than a regular employee by getting 6-7 client rides, on the other hand, he/she can stay stranded for the whole day without even one. The same kind of risks imply to all fields of jobs in terms of gig projects.

Taking such things into consideration, the Gig Economy has still got a few years to get streamlined. There is still a long journey for technology and management policies to be efficiently integrated with business policies to make contract-based jobs the next normal. One of the key driving forces in ensuring a smooth balance of the workforce between permanent and contractual is the HR and its hiring innovation.