A 2016 report by the McKinsey Global Institute, found that 20 to 30 percent of the working-age population in the United States and Europe partake in some of the other forms of independent work. Another interesting discovery by the study was the role played by digital platforms and how they are revamping independent work, underpinned by the substantial reservoir of individuals they can reach and the omnipresence of mobile devices.
And the real question that accompanies the growth of such digital platforms is if they stand to defy the norms of how companies are systemized.
What is driving the growth of the gig economy?
The gig economy isn’t just a cohort of independent workers. It also includes ‘moonlighters,’ i.e., people who do additional work besides their primary job. What’s interesting here is that earning more isn’t the sole motivation that is leading employees to foray into the gig economy. A survey by Adobe, titled Work in Progress, found that aside from earning more money, pursuing a passion was the number one reason why employees picked up a second job. Other top motivators, according to the survey, included networking opportunities, learning new skills, and obtaining more career-related experience.
Other than employees, another driving force behind the growth of the gig economy is technology. Disruptive technologies such as robotics, automation, artificial intelligence, and machine learning are also influencing the global workforce’s future, thus leading to the rise of the gig economy.
HR agility in the age of gig talent platforms
Today, companies must adapt to include gig talent to ensure they do not miss out on deep expertise as far as their talent strategies go. And when it comes to HR, to maintain agility, it needs to undertake various shifts. For starters, about 20 to 40 percent of any organization’s HR workforce should be gig talent. This will enable HR to deploy real-time expertise and be available wherever needed.
HR usually has a headcount with an average of 20 percent slack time, owing to the fact that the function itself has become over-engineered and over-specialized. And full-time HR workers can further beget complexity in their slack time. Gig talent can bring in the much-needed fresh air of simplicity because they are not full-time employees with the company.
In the context of HR function, gig talent allows HR teams to work on tangential requisites with far greater expertise . For example, if a company’s HR wants to create a virtual reality-based L&D module, they can hire a relevant VR expert instead of teaming up with IT.
Professional services behemoth EY has developed GigNow — a dedicated platform to recruit talent for their projects. And EY is not the only one; other large enterprises like Unilever, Procter & Gamble, and General Electric have also taken up the talent on-demand strategy.
What it means for the organization
A report by the McKinsey Global Institute, titled A Labor Market That Works: Connecting Talent With Opportunity In The Digital Age, found that that adoption of online talent platforms stands to reduce costs associated with talent and HR by as much as 7 percent and also boost output by up to 9 percent. And that’s not all; talent platforms enable companies reshape how they recruit, train, and deal with employees.
Out of the many benefits they offer in the context of traditional organizations, one of the most important one is that more informed decisions regarding human resources translate into improved business results. In addition to that, these platforms now also offer to ameliorate the entire process of talent management, including onboarding, engagement, team formation, performance feedback, and compensation.
Considering the ubiquity of talent platforms and the growing acceptance of the gig economy, there’s a good chance that a considerable portion of the talent organizations need won’t be on their payroll. And with that knowledge, they must also understand that employees must be provided the support they require to make sure that they possess the requisite skills in a swiftly evolving labor market.