As the number of ways people can find "gigs" increases, experts say HR leaders must first understand workers' current motivations before they can make the most of today's changing workforce.
By Julie Cook Ramirez
Freelancers. Independent contractors. Free agents. On-demand workers.
Whatever you call them, thereÂs no denying the booming trend toward working in a non-traditional capacity. Increasingly, the focus is on "gig economy workers" -- those who secure work through online intermediation platforms, such as Uber, Lyft, Airbnb, Upwork and others. According to Emergent Research, a Lafayette, Calif.-based firm that studies the free agent economy, 3.2 million Americans are currently engaged in gig-work arrangements, and that number is expected to reach 7.6 million by 2020.
Emergent recently partnered with IntuitÂs QuickBooks, Self-Employed, a provider of cloud-based financial software for free agents, to survey 4,622 gig economy workers and learn more about what makes these workers tick, how satisfied they are with their career choice, and what drew them to such work in the first place.
The survey found that people become gig workers for a number of reasons. Emergent researchers divided respondents into five categories:
Side Giggers comprise 26 percent of gig workers. Essentially "moonlighters," nearly 80 percent of them have either a traditional full-time or part-time job or own their own business. They take on outside work to earn more income and feel more financially stable in an unpredictable economy.
Career Freelancers account for 20 percent of the gig work population. Said to be "happily building a career through independent work," they overwhelmingly (93 percent) like controlling decisions about where, when and how they work. Sixty-nine percent feel more secure working on their own than in a traditional job, and 52 percent feel less at risk working independently than in traditional employment.
Business Builders make up 22 percent of gig economy workers. They like calling the shots in their own careers and just under 90 percent say they would never go back to depending solely on a traditional job for income. More than half (55 percent) own a business on top of doing on-demand work.
Substituters encompass 18 percent of gig workers. As their name implies, they turned to such work because they lost or couldnÂt find a traditional job. Not surprisingly, less than half (47 percent) expressed satisfaction with the on-demand work life.
Passionistas comprise just 14 percent of the workers surveyed. This well-educated group is driven by the desire to do something they enjoy. Eighty-eight percent say engaging in their choice of work trumps making lots of money.
These differentiations are important, says Steve King, a partner at Emergent, because they allow HR to gain a better understanding of their gig workersÂ motivations. This, in turn, allows for more effective management. For HR, that means taking more of a hands-on approach to this population, rather than relying on individual managers to facilitate the gig relationship. All too often, however, HR is left out of the loop, King says. ItÂs up to them to "get themselves back into the loop . . . and integrate this source of talent into their broader talent management plans."
HR leaders would be well-served to shift their mindset from "a singularity of focus on employees to managing a plurality of means for getting work done," according to Ravin Jesuthasan, global leader, talent management managing director in the Chicago office of Willis Towers Watson.
"The focus can no longer be solely on engaging people you see every day, but also on engaging talent you might see episodically or engage with in very different ways," says Jesuthasan. "HR needs to ask itself, 'What are the tools and processes that are needed to replicate the experience we create for employees for this broader, more diverse group of participants?Â "
Increasingly, King says, companies must endeavor to become employers of choice, not only for their traditional employees, but for gig workers as well. This is particularly true among higher-skilled individuals, who HR is often surprised to learn are making up a significant percentage of on-demand talent. In fact, King says, the gig economy is allowing many companies access to specialized talent they may not be able to hire -- or have a desire to hire -- on a permanent basis.
"The gig economy is no longer just about low-level jobs," says King. "Contingent workers are now doing important stuff at corporations. IT and marketing and even senior management are oftentimes 'super temps,' executive temps coming in."
That expertise has now extended to HR. New York-based Mercer recently unveiled PeoplePro, an online consulting hub that provides access to "HR expertise on-demand," according to Jo-Anne Bloch, a partner and team leader for Mercer's Innovation Hub. While the offering is primarily marketed to small businesses, the HR consultants that comprise the PeoplePro talent pool operate like any other gig economy workers -- taking on special projects, lending expertise or serving in a temporary capacity when an HR professional goes on leave or departs the company, leaving a void.
Regardless of what level gig workers they employ, employers need to accept that the shift toward on-demand work is not merely a passing reaction to rough economic times, says King, adding that the trend actually pre-dates the 2008 recession.
WhatÂs more, the majority of gig workers in the Intuit/Emergent survey expressed high levels of satisfaction -- from a high of 83 percent among business builders to a low of 47 percent among substituters. For the rest of the workforce, the recognition that they have options beyond traditional employment may very well lead to even more gig workers in years to come.
"ItÂs a pretty fundamental shift," says King. "There are no signs this is going to slow down, so companies need to figure it out."
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