Gig economy: what's its place in the future of work?
In this five-part series to understanding the gig economy, we'll look at a number of topics:
- What is the gig economy?
- How to integrate freelancers into a talent acquisition strategy
- The challenges of managing a freelance workforce
- Address skills shortages with talent pools and the hidden workforce
- Gig economy: what's its place in the future of work?
In this final part, we'll focus on how the gig economy could play a part in the future of work.
The four forces of employment change
Predicting what the future of work may look like starts with understanding the four forces of employment change:
Two social factors will impact how people choose to work in the future. Firstly, an increasing freedom of where to work, and secondly, a growing importance of who to work for.
Freedom of where to work
There is a growing community of 'digital nomads', who choose to abandon the conventional office and work from co-working spaces like Hubud in Bali or Dreamplex, in Ho Chi Minh.
Some industry commentators are predicting there to be 1 billion digital nomads by 2035. The increase driven by faster mobile internet speeds, declining rates of marriage and falling rates of home ownership.
Who to work for
Virtual offices, infrastructure-as-a-service, and video-conferencing are one factor enabling a change in the workplace. Technology removes the requirement for a company to locate its employees in a single location, and has been the biggest single catalyst for change in the office working environment.
Non-office working environments are also facing change now due to advancements in robotics and automation. Examples include Amazon's supermarket with no cashiers, or Foxconn's fully automated factory.
Technology is disrupting and transforming every industry. Consumers, workers, supply-chains are all undergoing digital transformation. Capgemini's report on the Digital Advantage shows the impact digital is having businesses in mining, gambling, fashion and every industry in between.
Product lifecycles are getting shorter and shorter, with Accenture saying customers now expect product innovations every 6 months - 'exponentially faster' than ever before.
Looking at the ONS data on redundancies in the UK, there is a clear upward trend over the last 12 months, which could indicate businesses are needing to change their organisational designs in response to market forces.
Combining the speed of technological advance, social factors and the commercial pressures for businesses to be more nimble creates an environment that supports the concept of the gig economy.
In response to the growing number of self-employed people in the UK, the Work and Pensions Committee, launched an inquiry into the impact of the gig economy in December 2016. The inquiry will assess the relative treatment of employees and self-employed people in the Universal Credit benefits system, how Job Center Plus should adapt to support those people wanting to become self-employed, how self-employed people can be encouraged to save for retirement and how self-employment can lead to full employment.
The content of the inquiry suggests the UK government is looking to better support and understand the gig economy.
Is it the end of the permanent job?
Accenture predict, 'within 10 years, we will see a new Global 2000 company with no full-time employees outside of the C-suite.'
This prediction, whilst extreme, suggests the future of the permanent role lies in managerial and strategic roles to maintain a consistent direction for a business. Supporting the consistent, permanent management team will be a network of specialist gig-workers that can flex and adapt to the rapidly changing business environment.
HR's role in the future of work
The systems, processes and expertise required to manage a business' people become more complicated the more a business becomes separated from its workforce. In a fast-moving, unpredictable business environment, where it is necessary for a business to use the speed and flexibility of the gig economy, HR's role is extremely important.
Mapping HR strategy to the business model
Every business model needs the right people to support it. HR teams will need to develop and align their strategy to support an increasingly diverse array of business models.
Understanding social change to attract the best people
HR teams will need to develop Contingent Value Propositions to attract and engage freelancers and gig workers. The challenge to retain the interest and attention of gig workers in between projects will be crucial to ensure business agility.
Compliance with regulations
The numerous reviews and inquiries into the gig economy will undoubtedly create new regulations and employment laws HR teams will need to manage and comply with.
Using the right technology to manage people effectively
Research by Gartner and Deloitte show HR teams spend £800 million on technology each year and this figure is growing in double digit percentages each year. As the gig economy places more demands on an HR team, selecting and investing in the right HR technology will become an increasingly important part of the HR team's responsibility.