Gig economy: A Revolutionary Trend for the Labor Market

Digital transformation of workplaces has generated new trends that revolutionize the labor market. Nowadays, on-demand and independent jobs have caused an increase in worldwide employment options, which has become a feasible and sustainable option for many people. Digital natives look for new ways of working and prioritize the chance of incorporating their jobs into their […]

Nicolas Castro May 17, 2022

Digital transformation of workplaces has generated new trends that revolutionize the labor market. Nowadays, on-demand and independent jobs have caused an increase in worldwide employment options, which has become a feasible and sustainable option for many people.

Digital natives look for new ways of working and prioritize the chance of incorporating their jobs into their personal life. Spending 9 hours in a crowded office is no longer an option for those who have experienced management by objectives and without the pressure of time. This new model is the demonstration of “life-work balance” on which new generations are based and they put it into practice in every opportunity that the labor market has for them.

So, within this context of freelancers seeking professional growth and labor diversity rather than one job for their whole life, arose a concept in America that has become popular during the last years: the Gig economy. According to the Cambridge Dictionary, the Gig Economy is a way of working that is based on people having temporary jobs or doing separate pieces of work, each paid separately, rather than working for an employer. In general, these temporary services set by objectives are offered on digital platforms that establish a connection between workers and users who are asking for a specific service. As stated by the Gig Economy Index, almost 40% of the American labor force generates at least 40% of their incomes within this model. Besides, as claimed by the research From Workforce to Workfit, carried out by Kelly Services, a company specializing in external consulting, the demand for this kind of workers in that country is 47%. Independent freelancers’ microbusinesses in America represent 17% of the gross domestic product, which generates US$2.4 trillion.

 

 

The worldwide figures indicate the growth of this trend: the demand in Asia is 84%, in Europe it is equivalent to 80% and finally, in South America it reaches 54%. Taking into account these figures, many experts claim that the gig economy is the future of work, due to its outreach, facilities and working benefits both for employees and employers.

Among the most remarkable gig economy benefits and advantages for a freelancer, we can mention that:

Independent workers improve their quality of life: reaching a balance between personal life and work is one of the most valuable advantages. Remote jobs enable them to sleep better and even eat better, as they are not under the pressure of time.

They can have a flexible schedule: as they are hired for a certain project or objective, this type of worker is able to manage their time in the most convenient way.

They feel motivated: a freelancer is highly motivated since they have the chance of working in a field they love. Management by objectives makes tasks become more specific, so they feel more at ease.

They can save money: independent workers save on daily expenses, such as commuting or having lunch on the go.

It is also important to note that remote jobs give the possibility of generating incomes to people who are usually excluded from the traditional way of working, for example, those who are in charge of caring for others or are unable to commute due to a lack of mobility.

This methodology is also beneficial for enterprises, as they acquire the necessary resources and talents at the appropriate time and place. Freelancers really value independent work and they are constantly getting qualified, which makes it possible for the enterprise to create a highly competitive work team. However, this represents new challenges for the companies that must incorporate their traditional teams into the remote ones. According to Kelly Services’ research, the enterprises that succeeded in this in an innovative way it is because they passed on the business culture early, implemented a comprehensive onboarding process and used adequate digital tools.

Some data that show this trend worldwide are:

      The number of digital platforms that facilitate online work or that hire workers directly to offer their services increased fivefold around the world in a decade. 

      Only 13% of people who worked remotely by the end of 2021 have fully come back to the face-to-face model, as stated by Infojobs’ research.

      A McKinsey report shows that more than 150 million people from Western Europe and North America have decided to become independent workers during the last decade.

      Lately, it has been known that more than 4 million American people have quit their permanent jobs willingly in order to set up their own businesses or work on their own.

 

As technology improves and the labor force evolves, the gig economy emerges as an original way of working which is based on independent development and without any geographical limits. Some of its advantages are easier access to opportunities, more efficient use of resources and comfort for workers and clients.

In this model marked by a versatile and disruptive economy, specialization and knowledge are not limited by recruitment methods or borders. More than ever, there is huge competition in the business world and digitalization has become a need rather than an option in order to be at the forefront of the current market.