Growth of the Gig Economy: What SMEs Need to Know

  • By Admin
  • December 29, 2020

Indian economy is at the cusp of reshaping its white-collar workforce more so pertaining to the SME sector & this is being widely influenced by the “on–demand workers” phenomena. Of late, freelance or contract work becomes a staple source of earnings for the white-collar workers.
Thus the traditionally defined salary positions is witnessing a shift. Contract work includes self-employed, temp workers, contractors, on-call workers, and part-time employees, spanning trades that range from construction to healthcare, including professional services such as fashion designing and web development &not just limited to Zomato and Swiggy that employs home delivery staff.

Gig Economy – Born out of market volatility

What started as a great recession of 2008 was a prelude to the onset of gig economy. Back then nothing much was going on in the hiring space but people who lost salaried jobs needed to make ends meet. To a large degree, the online world started churning out job offers which
created a new marketplace for people to look out for vacancies having contract positions.

At the same time, businesses needed to deal with an erratic market lowered credit offerings, and unavoidable layoffs. Therefore contract workers were hired more than regular employees to keep the costs down, and it paved the way for operational flexibility enabling to resize operations depending on the amount of workload.

Fast forward 10 years &though the economy has picked up & was on the rebound but still had an all-time low unemployment rate. But the size of the independent workforce continues to grow.

What makes Gig Economy Tick?

Recent studies involving a considerable percentage of people who work full-time, either as salaried employees, independent professionals, or business owners expressed several challenges which included sourcing talent or contractors for attracting new customers/business.

The study also revealed that once people exist in the traditional workforce, few would want to go back, as they have no aspiration to return to traditional work, and many said they will choose to work post their retirement age.

The study also estimates that a large portion of the working population are poised to leave traditional work for full-time self-employment and that millennials will account for 40% of tomorrow’s independent workforce.

Feeding Into the ‘Gig’ grind

Like any other businesses, more SMEs are feeding into the gig economy. They are sourcing talent on contract not just to optimize cost, but to help achieve clear-cut goals.

For instance, Avenue growth hires growth specialists who can free up currently working for staff from doing routine work to focus on more strategic, complex projects necessary to grow your business or to help deal with a surge in demand for products or services. Alternately, SMEs can appoint staff on a contract having niche skills to get the expertise they need to diversify into new avenues or lines of business.

Managing the Snags

No doubt there are always challenges in meeting the needs of the new age workforce made up of young folks. Such a young force is very particular about, what assignments they get to work on or what type of projects interest them.

Some may ask for flexi-working hours & yet some may ask for work from home kind of an arrangement as well. Moreover, companies that hire contractors have to manage workers who are often off-site, plan their working hours, and may have several priorities and may not be well versed with their company’s future roadmap.

Also, companies who are on the cloud make it easier for contractors and flexible workforce employees to work together, irrespective of where they’re working from. Office operations just don’t happen over email and phone, rather today it happens via video conferencing etc. which help people collaborate in real-time.

End Note:

No economy is perfect& the same applies to the gig-based markets. Even so, SMEs have only to gain than lose from the “on-demand” model. Although traditional hiring will continue for filling up certain roles, having said so “Gig models” can provide SMEs with a convenience that is unmatched when it comes to filling up temporary positions to avail the necessary expertise towards pursuing superlative growth opportunities.

Growth of the Gig Economy: What SMEs Need to Know