Gig Economy – Futurising the Future
Everyone recognizes that digital disruption is happening and many organizations across the different sectors are undergoing some form of business transformation and discussing the future of work. In PwC survey on the Workforce of the Future, carried out in China, India, Germany, the UK and the US, identified 5 megatrends that will transform the way people work over the next 5 to 10 years ie. Rapid urbanization, Demographic shifts, Shifts in Global Economic power, Resource scarcity & Climate change and Technological breakthroughs. Disruption is now the norm.
I prefer to talk about these trends impacting on workplace and workforce as the ‘Work of the Future’ rather than the more commonly used term “The Future of Work”. I think the former terminology is far more optimistic (and I think more accurate) than the latter. It implies a shift in how work will be performed in the future, rather than questioning whether work has a future and will still exist. Full time work does not ‘need’ to exist now. The role of digital technology is a critical element of the sharing economy. This has given rise to the new economic model of ‘Gig Economy’.
Hailed as the “new economy,” the gig-economy is expected to account for more than 40 percent of the workforce in the USA by 2020. It is an emerging labor market, wherein organizations engage independent workers for short-term contracts (“gigs”) to create virtual jobs, often by connecting workers to customers via a platform-enabled digital marketplace. By 2020, for instance, the number of self-employed workers in the United States is projected to triple to 42 million people. Freelancers are the fastest-growing labor group in the European Union, with their number doubling between 2000 and 2014; growth in freelancing has been faster than overall employment growth in the United Kingdom, France, and the Netherlands. And many people are alternative workers part-time: Deloitte’s latest millennial study found that 64 percent of full-time workers want to do “side hustles” to make extra money.
In Malaysia, according to the World Bank data, about 26% of the Malaysian workforce are freelancers and that the number is growing, as more people are opting for more flexible working hours.
The shortage of skillsets, is going to be even more acute as the demand for skills and knowledge like strategic thinking, smart automation, social media, creativity and innovation and process excellence will far exceed supply over the next 3 to 4 years. According to the 2018 WEF’s “The Future of Jobs Report,” 54 percent of all employees will require significant reskilling and everyone will need an extra 101 days of learning by 2022. That finding was echoed by the WEF’s Klaus Schwab in a report titled “Towards a Reskilling Revolution: A Future of Jobs for All,” which said workers must engage in lifelong learning if they want to not just remain employable, but to achieve fulfilling and rewarding careers.
In view of the pressing skill shortages, organizations need to strategically rethink in terms of its current employment model. How fully are organizations capitalizing on the alternative workforce today? Deloitte 2019 Global HC Trends’s survey results suggest that many could be doing more. 41% of their survey respondents told them they considered this issue important or very important—but only 28 percent believe they are ready or very ready to address it. In fact, Deloitte’s research suggests that most organizations look at alternative work arrangements as a transactional solution, not as a strategically important source of talent. Only 8 percent of their respondents, for instance, said that they had established processes to manage and develop alternative workforce sources; fully 54 percent of respondents said they either managed alternative workers inconsistently or had few or no processes for managing them at all. These organizations are using alternative work tactically as a way to “fill slots,” not strategically as a long-term solution for the future. And that is a missed opportunity.
Rewiring the approach to the alternative workforce
Engaging alternative workers strategically is harder than it looks. To do so, companies have to move beyond “managing” contractors and freelancers to “optimizing” and “leveraging” the alternative workforce deliberately and well. Not many do. Even among companies with policies and standards, previous experience suggests that a strategic, enterprise-wide approach is rare. What is needed is a wholesale rewiring of how organizations operate as it relates to alternative labor—one that allows it to connect the appropriate talent with the appropriate roles no matter how that talent is sourced. Part of the answer lies in connecting the various parts of the enterprise involved, often in a fragmented manner, in hiring alternative workers. This includes procurement, IT, and, increasingly, HR. This is where an efficient talent and business marketplace platform can meet these requirements. Check out www.gigxglobal.com
HR function can play a critical role on this matter. They need to go beyond the traditional employment model to a more agile talent mix model. In the race to grow, this is where strategic workforce planning and technology is key, in finding the right blend of employee and non-employee talent to achieve specific organizational outcomes. As such, HR functions or departments should adopt a diversified approach in acquiring digital talent, including identifying new channels for acquiring digital talent as alternatives to conventional methods.
Also, the advent of alternative workforce in the traditional employment model has added a certain degree of complexity and diversity to the management of corporate personnel. Changes in the employment landscape need new regulations. The legal framework in terms of social security, insurance, contracts and all that is really important. This needs to be developed in Malaysia. For example, look at the labour law or construction law. Some of the gig workers here for example, wouldn't be allowed to do the same work in European countries. As a case in point, motorbike delivery riders who would need more protection there.
To sum up, the Internet-based Gig Economy can bring huge benefits to organizations, if they leverage and optimize these available opportunities in terms of the available diverse talent availability in the marketplace as well as technology opportunities. This requires current HR practitioners to be more agile, to prepare for a new type of employment relationship, to seek the balance between the organization and multi-stakeholder, to draw on each other's strengths, to take full advantage of the benefits of the odd job economy, but also to actively correspond to its shortcomings, to achieve the cooperative development of organizations and odd jobs market.
For a start, quoting directly from Nathalie Hazenberg’s thoughts in her Linkedin write-up, HR practitioners can rethink topics like: -
This is just a start. Think differently, and scale up over time!
I prefer to talk about these trends impacting on workplace and workforce as the ‘Work of the Future’ rather than the more commonly used term “The Future of Work”. I think the former terminology is far more optimistic (and I think more accurate) than the latter. It implies a shift in how work will be performed in the future, rather than questioning whether work has a future and will still exist. Full time work does not ‘need’ to exist now. The role of digital technology is a critical element of the sharing economy. This has given rise to the new economic model of ‘Gig Economy’.
Hailed as the “new economy,” the gig-economy is expected to account for more than 40 percent of the workforce in the USA by 2020. It is an emerging labor market, wherein organizations engage independent workers for short-term contracts (“gigs”) to create virtual jobs, often by connecting workers to customers via a platform-enabled digital marketplace. By 2020, for instance, the number of self-employed workers in the United States is projected to triple to 42 million people. Freelancers are the fastest-growing labor group in the European Union, with their number doubling between 2000 and 2014; growth in freelancing has been faster than overall employment growth in the United Kingdom, France, and the Netherlands. And many people are alternative workers part-time: Deloitte’s latest millennial study found that 64 percent of full-time workers want to do “side hustles” to make extra money.
In Malaysia, according to the World Bank data, about 26% of the Malaysian workforce are freelancers and that the number is growing, as more people are opting for more flexible working hours.
The shortage of skillsets, is going to be even more acute as the demand for skills and knowledge like strategic thinking, smart automation, social media, creativity and innovation and process excellence will far exceed supply over the next 3 to 4 years. According to the 2018 WEF’s “The Future of Jobs Report,” 54 percent of all employees will require significant reskilling and everyone will need an extra 101 days of learning by 2022. That finding was echoed by the WEF’s Klaus Schwab in a report titled “Towards a Reskilling Revolution: A Future of Jobs for All,” which said workers must engage in lifelong learning if they want to not just remain employable, but to achieve fulfilling and rewarding careers.
In view of the pressing skill shortages, organizations need to strategically rethink in terms of its current employment model. How fully are organizations capitalizing on the alternative workforce today? Deloitte 2019 Global HC Trends’s survey results suggest that many could be doing more. 41% of their survey respondents told them they considered this issue important or very important—but only 28 percent believe they are ready or very ready to address it. In fact, Deloitte’s research suggests that most organizations look at alternative work arrangements as a transactional solution, not as a strategically important source of talent. Only 8 percent of their respondents, for instance, said that they had established processes to manage and develop alternative workforce sources; fully 54 percent of respondents said they either managed alternative workers inconsistently or had few or no processes for managing them at all. These organizations are using alternative work tactically as a way to “fill slots,” not strategically as a long-term solution for the future. And that is a missed opportunity.
Rewiring the approach to the alternative workforce
Engaging alternative workers strategically is harder than it looks. To do so, companies have to move beyond “managing” contractors and freelancers to “optimizing” and “leveraging” the alternative workforce deliberately and well. Not many do. Even among companies with policies and standards, previous experience suggests that a strategic, enterprise-wide approach is rare. What is needed is a wholesale rewiring of how organizations operate as it relates to alternative labor—one that allows it to connect the appropriate talent with the appropriate roles no matter how that talent is sourced. Part of the answer lies in connecting the various parts of the enterprise involved, often in a fragmented manner, in hiring alternative workers. This includes procurement, IT, and, increasingly, HR. This is where an efficient talent and business marketplace platform can meet these requirements. Check out www.gigxglobal.com
HR function can play a critical role on this matter. They need to go beyond the traditional employment model to a more agile talent mix model. In the race to grow, this is where strategic workforce planning and technology is key, in finding the right blend of employee and non-employee talent to achieve specific organizational outcomes. As such, HR functions or departments should adopt a diversified approach in acquiring digital talent, including identifying new channels for acquiring digital talent as alternatives to conventional methods.
Also, the advent of alternative workforce in the traditional employment model has added a certain degree of complexity and diversity to the management of corporate personnel. Changes in the employment landscape need new regulations. The legal framework in terms of social security, insurance, contracts and all that is really important. This needs to be developed in Malaysia. For example, look at the labour law or construction law. Some of the gig workers here for example, wouldn't be allowed to do the same work in European countries. As a case in point, motorbike delivery riders who would need more protection there.
To sum up, the Internet-based Gig Economy can bring huge benefits to organizations, if they leverage and optimize these available opportunities in terms of the available diverse talent availability in the marketplace as well as technology opportunities. This requires current HR practitioners to be more agile, to prepare for a new type of employment relationship, to seek the balance between the organization and multi-stakeholder, to draw on each other's strengths, to take full advantage of the benefits of the odd job economy, but also to actively correspond to its shortcomings, to achieve the cooperative development of organizations and odd jobs market.
For a start, quoting directly from Nathalie Hazenberg’s thoughts in her Linkedin write-up, HR practitioners can rethink topics like: -
- Diversity and inclusion, that would be automatically present in an inclusive hybrid workforce eco-system based on talents and business drivers;
- Wellbeing, which can only be achieved if we are willing to focus on energy and momentum driven by purpose and talents;
- Traditional leadership, that is not realistic anymore in a fast-changing world where not one person has all the knowledge but shared leadership is needed to make better decisions;
- Re-organizations, to incorporate a cross sector liquid workforce that is supported to reskill, upskill or redeploy on a regular basis;
- Job descriptions, which can be as simple as a code for a salary grade if we are willing to craft the right roles for anyone who wants to contribute at any time with the right psychological contract and employee experience; and
- Targeting age-groups and putting people in boxes is not needed if we connect generations and support anyone in creating the right place for work in their personal lives.
This is just a start. Think differently, and scale up over time!
If you want to go for training, you will have to pay that out of your own pocket. For many freelancers, it could be challenging to find additional funds to invest in training or to improve skills that may help them make a better living.the difference between contract jobs and gig work
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