4 Advantages of the Gig Economy for Businesses
In just the past year, the U.S. workforce has seen substantial changes due to the shifting demands and trends in the global economy because of the COVID-19 pandemic. At this point, it is safe to say that freelancers and temporary workers have taken over a significant part of the total labor force in the country.
The rise of gig economy companies appears to be more than just a short-term trend. A recent Business Wire article discussed the highlights of Upwork’s comprehensive structure, which showed how the emergence of more Millennials and Gen Z workers in the freelance workforce changed their employment structure due in part to their preference for flexible alternatives to traditional employment.
It was only a matter of time before the freelance revolution shaped the future of employment. As much as freelancing appears to be beneficial to workers, there is no denying that businesses also enjoy a number of advantages by hiring gig workers. Below are some of the benefits that the gig economy provides for employers:
Minimize Costs and Expenses
Saving money is among the most common objective that any kind of business faces, and minimizing costs and expenses has been one of the major outcomes that top gig economy companies are experiencing. Capitalizing on the surge of gig workers, businesses that hire off-site workers eliminate the need to have or maintain expensive work spaces, large office equipment, complicated computer systems, and in-house personnel.
In addition to up-front employment costs, obtaining services from gig workers allows businesses to save big on costs from employee benefit packages, like retirement plans and paid leaves. According to a recent U.S. Bureau of Labor Statistics (BLS) study regarding the “Employer Costs for Employee Compensation”, employee benefits comprise 32% of an employee’s compensation. By hiring gig workers, business owners can then divert these savings to other aspects of their company.
Allow Employees to Focus on High-Value Work
Giving employees tasks that are outside of their scope of work or expertise may often lead to poor work efficiency and low levels of effectiveness. Businesses can avoid this by outsourcing secretarial tasks to self-employed individuals, particularly to virtual assistants via gig economy companies.
Freelance professionals can do expense accounting, appointment scheduling, basic research, and basically any ordinary office task, which would allow in-house employees to focus on the more high-value work, instead of dealing with time-consuming tasks that can be outsourced. Consequently, utilizing gig work enhances the overall performance of the company.
Furthermore, businesses that engage in the gig economy take advantage of the network of available contractual workers who match the temporary job vacancy they have. From website design and development, or social media marketing, to cleaning or delivery services, those who need specialists in almost all kinds of work can simply tap into the long list of gig economy companies to find the exact personnel they are looking for.
Hire Seasonal Employees without Much Difficulty
In particular, seasonal businesses can benefit the most from the gig economy. Previously, companies utilized existing agencies that provide temporary workers, however, these services charge fees that can be costly to some, especially small businesses. Hiring freelancers via the gig economy, however, can prove to be an easier and much more practical way to procure specialty services from professionals without having to pay additional fees to different agencies.
Instead, the gig economy provides a network of workers that creates a direct contract between the company and the freelancer. This removes the hassle of dealing with middlemen throughout the entire business process, and makes it easy for companies to find self-employed contractors to complete any job.
Expect Better Outputs
Many modern workers prefer a flexible employment situation. Many gig workers want to earn extra income aside from their regular jobs. Today, more and more highly skilled professionals turn to freelancing and independent contracting, and as a result, employers nowadays tend to find workers who provide better outputs by tapping into the gig economy.
Most freelancers tend to stay up-to-date on the current trends and practices in their particular industries, thus they are equipped with knowledge and skills that can be more useful to different businesses. This benefits companies that hire freelance workers, in general, since their efforts steadily draw in more customers in a more efficient manner, and the increased diversity in their workforce can better serve a wider range of customer needs.
The gig economy is creating a wave of change in the modern workforce. Driven by flexibility in type of work and work schedule, there exists a network of self-employed independent contractors that offer a solution to almost all types off business. Magnified by the global pandemic and the impact that COVID-19 has had on the global economy, the current trends have created a need for this new workforce. Nowadays, successful businesses are finding ways to tap into this new work force to capitalize on the network of skilled workers looking for jobs, and maximize their outputs.