The gig economy, or digital platform work, is growing rapidly. It’s transforming the world of work as we know it.
More and more people are choosing flexible working patterns and lifestyles over 9-to-5 office jobs, which has many implications for businesses and employers.
Luckily, adapting to the new reality doesn’t have to be difficult if you follow and understand what the latest employment trends are all about.
In this article you’ll learn about:
- The top 5 gig economy trends to help your business prepare for the future of work
- Expert insights & recommendations to help you welcome more gig workers into your organization (and get it right)
- The future of the gig economy and the role of technology (and what it means for businesses)
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The gig economy is the new black
The gig economy is getting bigger. In America, over 30% of the working population is already in some gig capacity. Not surprisingly, the trend is going strong in the post-pandemic world.
From the employee perspective, the gig economy creates job opportunities, mostly due to the rising demand for delivery apps and services. It also offers alternatives for employees who don’t want to be stuck in 9-to-5 office jobs and prefer more flexible lifestyles.
From the employer perspective, using gig workers benefits high-volume recruiting environments and companies that can’t afford or don’t need full-time employees. Hiring part-time or temporary workers also makes sense during busier times or for specific projects.
Additionally, using the alternative, on-demand workforce is gaining popularity in the economic downturn. Many companies are opening up to new and unconventional ways of doing business to cut costs in uncertain times.
So how can your business make the most of the gig economy? Are you ready for it? Do you have the right technology in place?
What is the gig economy?
The gig economy allows companies to hire independent workers for short-term commitments: part-time hires, freelancers, independent contractors, project-based workers or other temporary workers.
It’s also called digital platform work as digital platforms connect freelancers/gig workers with potential clients.
Gig economy jobs are common in:
- Accounting and finance, e.g. independent consultants
- Administration, e.g. admin assistants
- Content production, e.g. copywriters
- Design, e.g. graphic designers
- IT, e.g. security engineers
- Media, e.g. photographers
- Project management, e.g. project managers
- Software development, e.g. DevOps engineers
- Transportation, e.g. ride-hailing drivers
What are examples of digital platform work?
Uber, the largest ride sharing company in the world, is a good example of a company employing gig workers. Uber’s business model is dependent on large numbers of people (drivers) who don’t feel particularly attached to the company, mainly due to the type of contract.
Other examples of gig economy jobs involve TaskRabbit workers, Airbnb landlords, online marketplace sellers, influencers, on-call workers, seasonal workers and consultants.
Top gig economy platforms include:
The digital platform work growth and new employment trends
In 2020, the gig economy experienced significant increases, mainly in response to COVID-19. This was the effect of significant job losses, but also the new independent work opportunities the pandemic created, e.g. virtual assistants in digital customer experience.
Technology and automation played a big role in this shift. Additionally, new opportunities made many workers reevaluate their priorities. Companies, in turn, decided to reevaluate their budgets.
Fast forward to today, and the number of gig workers has gone up since the pandemic hit. It’s expected to keep rising.
It’s not surprising. First, in uncertain times, more and more workers are on the lookout for alternative incomes. Second, people are increasingly prioritizing lifestyle over earnings. This appears to be easier for freelancers than for those working full-time jobs.
So gone are the days of working 9-to-5 in a cradle-to-grave job. This has many implications for businesses. The world of work keeps changing and employers need to adapt to the new reality.
The gig economy is growing fast. As it may be challenging to keep up with a dynamic job market, don’t wait to prepare your business for the future. You need to be smarter than your competitors and get ready to hire more platform workers!Piotr Smolen, CEO at Symmetrical
#1. Gig economy trend: digital platform work is growing
The gig economy is expanding 3x faster than the total US workforce. There’s a massive shift from traditional work and full-time employment to freelancing, independent contracting and working part-time.
According to some projections, gig workers may outnumber the traditional workforce in many sectors. No wonder: an increasing number of freelancers would not go back to a traditional job. They feel happier, healthier and more secure.
Consider these stats:
- Around 40% of executives worldwide expect freelancers to account for an increased share of their organization’s workforce over the next few years. 50% agree that corporate adoption of gig platforms would be a significant trend (BCG Henderson).
- By 2027, 60% of the US workforce will be independent (Business2Community).
- By 2027, the “alternative workforce” of gig workers is expected to become the majority of the US workforce (Deloitte, Upwork).
- By 2027, the number of freelancers is expected to reach 86.5 million in the USA (Wonolo, Statista, Upwork).
- 40% of organizations plan to use more gig workers in the next 5 years (Sama School).
- 80% of large US companies plan to increase their reliance on a flexible workforce and more non-traditional workers in the coming years (Intuit).
- 1 in 6 traditional job workers would like to become an independent earner (Upwork, McKinsey).
It’s a fact: independent work has big growth potential.
#2. Gig economy trend: the impact of technology
The impact of technology is significant in the gig economy. Almost 80% of freelancers say technology makes it easier to find work (Upwork).
Thanks to technology, freelancing, which used to be a side hustle, has turned into a trillion-dollar industry with millions of participants.
Online talent networks are growing quickly and are employing hundreds of millions of people around the world.
According to Payoneer, over 70% of freelancers find jobs through gig economy websites, such as Upwork, Fiverr or Toptal and online markets.
#3. Gig economy trend: the role of automation and gig apps
With platform workers using new gig apps and digital processes, the new digital engagement opens up unexplored territory in gig work.
- The bottom line: Businesses can expect some rapid changes.
- The question is: Will companies have the technology to meet the new gig reality?
Companies employing gig workers will need software and digital apps that simplify complex processes. This is the future of the gig economy.Piotr Smolen, CEO at Symmetrical
For example, think about an app that would allow gig workers to pay into a healthcare fund.
Or consider Uber. Uber has been so successful as it delivers a data-driven unified experience. The Uber app shows drivers what goals they need to accomplish (and how). This model shows the importance of simplicity in gig work.
Now consider payroll: one of the most important aspects for HR and finance departments to deal with when hiring gig workers. In the gig economy, you can expect much more complex and volatile hiring and payroll operations.
As a result, simplicity, flexibility and efficiency are essential. Manual work and multiple spreadsheets are not an option any more. Unfortunately, most payroll solutions are not ready for this change.
Therefore, the Symmetrical payroll solution allows you to hire at scale and pay people on time by automating your payroll.
#4. Gig economy trend: regulating digital platform work
The gig economy is expected to impact the legislative and payroll processes. For example, in the EU the big debate now is over the working conditions of platform workers.
In December 2021, the European Commission proposed legislation on improving the working conditions for gig workers. Thanks to the EU Directive, EU-based gig workers would be reclassified as employees. For this, gig workers would have to meet certain criteria.
Gig workers classified as employees would gain the right to:
- A minimum wage
- Safety protections
- Insurance against workplace accidents
- Paid leave
- Old-age pensions
- Unemployment benefits
- Collective bargaining
As a result in the future, gig workers should have more rights and protection. They should also be payroll employees. Without being on a regular payroll, they may struggle with getting paid on time, or at all.
By 2027, companies will be spending $6 billion on improving the rights of gig workers.Business2Community
Thus, a modern automated payroll solution will be a must for employers, especially if they hire large numbers of gig workers.
Automated solutions will be essential for employers. In fact, they already are. Having the right technology and software will be extra important for HR, payroll and finance teams.
#5. Gig economy trend: more collaboration among gig workers
Technology is expected to help gig workers collaborate more easily (and more often).
Think about this. People often want to earn more from work than money. Gig workers usually do similar work activities as traditional employees but they don’t collaborate. Luckily, technology and digital transformation can help them form a community.
For example, a gig work app can have its own built-in social feed so users could:
- Celebrate accomplishments
- Receive notifications from other creators complimenting their work (notifications about accomplishments can raise user-app engagement)
- Forge connections
- Share insights
Digital platforms can help harness the full potential of technology to make gig/remote work easier and more fulfilling for millions of people.
Symmetrical’s automated solution does that, too: it makes work easier for gig workers (and for HR departments and other business executives).
Gig economy trends: conclusion
Not everybody feels comfortable returning to the office in the post-pandemic world. Many people have redefined what work is. Furthermore, traditional office employees are likely to demand a setup that looks more like gig work with all its flexibility.
The pandemic and a disrupted economy have accelerated the growth of digital platform work. Businesses and HR departments must be ready for this.
Digital platform work is changing the contemporary business landscape. Having the right technology and software will be essential for companies, especially for HR, payroll and finance teams.Piotr Smolen, CEO at Symmetrical
So organizations must be ready to welcome more platform workers … and put them on payroll!
Is your payroll solution ready for the gig economy?
Symmetrical is the first payroll solution you won’t hate. We enable fast-paced companies to onboard at scale and run their payroll invisibly. To run your payroll hassle-free, on auto-pilot, contact our experts to learn more!
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