Why gig economy is on the rise

The corporate world is changing at an alarming pace, and so are the preferences of employees. The expectations that millennials have are far different from what employees desired two decades back. Their priorities are different. For them, it is not all about the compensation but also about work-life balance.

The corporates can brag all they want about how much work-life balance they are providing to their employees or the high level of inclusiveness they are ensuring, but the fact remains that sometimes things never change. And when an employer fails to meet expectations, the employees have no other choice but to look for other prospects.

Earlier there weren’t many options to choose from. Employees could only switch between companies in search of satisfaction. But now, technology has changed the working model of traditional companies, and new-age startups have emerged giving rise to a whole new breed of workers—gig workers.

Generally, in India, cab drivers and delivery partners working with mobile-based food delivery apps work on this model.

They are paid on the basis of the number of deliveries or rides they complete in a day. And further incentives are provided on great achievements.

Then, there are the freelancers. A lot of freelancers exist in the creative field, working for different organisations and companies.

They also work in the software ecosystem. In fact, Indian freelancers make up about 50 per cent of global freelancers.

We all know that freelancers definitely seek and enjoy work-life balance, the independence to work with different employers, and no restrictions on working hours. But what about the businesses? Are they be able to gain something from the gig economy? Will they benefit from the rise in the gig economy?

Let’s consider some of the points below –

Cost saving – According to a study, 57 per cent of businesses are saving cost in the US. Out of these, 43 per cent are saving at least 20 per cent of the cost.

With gig workers, companies are able to save costs in terms of insurances and vacation leaves. Apart from that, when there are less employees physically present in the offices, the need for spacious and large workplaces is eliminated. Cost is saved on rent, electricity, computers, servers and so on.

If a company works remotely, there are no office expenses at all. All the costs thus saved can be re-invested in the business.

Seasonal workload – At times, the sales of a company increase rapidly during a particular season. At that time, it becomes difficult for the in-house employees to handle the entireworkload by themselves. To meet this demand, companies generally try to contact the agencies that provide temporary workforce. But these agencies charge their own fees. To save that cost, companies hire freelancers directly and are able to meet their seasonal demands.

Flexible working patterns – As we know, freelancers can work at their own pace and convenience. Sometimes, they are willing to work at odd hours and outside the confines of a work week. This can help employers complete their projects on time and deliver faster.

Some businesses still have their doubts about gig workers and their productivity levels. But nowadays, jobs are not given on the basis of the degrees that candidates possess, but on the basis of the kinds of skills they have. Gig workers are able to deliver faster and better results as they work at their own pace and do not follow any set working hours.

However, people will also need to understand that there are only some roles which can be shifted to a freelance or work-from-home model. For instance, roles such as operations in a manufacturing unit, cannot be shifted to this model.

A clear shift has been seen in the last few years. A recent survey revealed that around 70 per cent of organisations in India have used freelancers at least once to complete their projects.

This means, if we try to create a balance, we can all benefit from the gig economy.