Gig Economy and Its Impact on Staffing Firms

The gig economy is on the rise.

With over 20.5 million US workers losing their jobs in April 2020 during the national lockdown, many people sought new opportunities in freelancing, consulting, and other temporary jobs. While only 36% of US workers actively contributed to the gig economy before the pandemic, about 90% of people are now seriously considering freelancing and other independent jobs.

No wonder the gig economy is growing about 3 times faster than conventional jobs!

So, what’s this hype about independent working, and what are other reasons behind this growing trend? Let’s take a look -

Flexibility - The foundation of the gig economy
The ability to work at one’s will is what the gig workers love the most. They are not tied to fix timings, strict attendance regulations, and constant online availability, some of the biggest drawbacks of conventional jobs. Although they also work with strict deadlines, the gig workers are free to choose their schedule and maintain a stable work-life balance. If the rate of gig continues to increase at this pace, about 50% of the US employees will be a part of it by 2027.

Multiple work sources – No binding contracts
As the freelancers and independent contractors are not bound to a single organization for work, they are likely to experience a manifold increase in their earnings. Working with multiple organizations at the same time also enhances their work experience and helps them take their career a notch up. Many of them also end up being successful entrepreneurs in the long run.

With the gig economy on a rising curve, the entire work scenario may change in the future. Technology will be at the heart of professional communication, delegation, and performance, especially when it comes to the offsite groups (gig workers). There will also be changes in labor regulations, which are developed mainly around the traditional work structure.

The gig economy and staffing firms – What’s changing?
Previously, the staffing firms didn’t consider short-term workers because of several myths, such as a lack of sincerity, availability, and stability around them. However, with an increase in flexibility brought about by remote working and outsourcing, the talent supply chains are getting rid of their stigmas about independent workers and adapting to the changing work structures.

So, how is the gig economy impacting the staffing firms?

Gaining greater availability of talent
The gig economy is free from geographical barriers, making it possible for staffing firms to hire talent from anywhere in the world. This gives them greater flexibility and more opportunities to take advantage of the greater availability of talent. Further, they can retain independent employees for long-term projects by fulfilling their primary requirements – flexibility and freedom.

Increasing customization
Staffing companies are looking at the gig workers for highly skilled, on-demand jobs. However, since these are unlike typical 9-to-5 jobs, the staffing firms need to upgrade their management and hiring systems to offer a customized experience to the candidates. They need to look for modern ways to search for the right candidates, schedule interviews, get them onboarded for specific projects, and facilitate their payments.

Ensuring transparency
Unlike full-time jobs with multiple layers of corporate bureaucracy between job seekers and their employers, the gig economy is more transparent and upfront. As a result, the staffing firms need to tweak their hiring policies and processes to ensure transparency at all levels and focus on building trust.

Breaking conventions
While a majority of the enterprises have realized the benefits of including gig workers in the mainstream job market, some organizations have still not got to terms with the trend. Hence, the staffing agencies need to take the responsibility to change the traditional mindset of the employers and encourage them to hire more gig workers.

Read: How Startups Can Ensure Success While Working With Freelancers

Innovating new business models
The staffing companies can ride on the gig economy by coming up with innovative business models. They can create a niche for themselves by showcasing their expertise in hiring a specific type of talent. They can also add value by doing candidate management and relationship building with the gig workers. By using the latest technology, they can help companies hire better and faster. If some employers are unsure of hiring freelancers, staffing agencies can convince them for the same and offer to do a thorough evaluation and background checks of the independent workforce.

Organizations can benefit immensely from the rise in the gig economy. They can quickly scale up their teams without increasing hiring expenses. They can also access the global talent pool without breaking their banks and create round-the-clock teams across different time zones.

How is your staffing firm realigning its strategies for the gig workers?