We've all heard of Uber and Airbnb, but those companies are just a fraction of the new gig economy, which is made up of part-time workers and freelancers.
A study by the JPMorgan Chase Institute reveals that the number of current gig workers has grown 10 times since 2012 and that 4% of adults in the U.S. have at one time worked in such a capacity.
Talent on tap
According to Mike Wachholz, president of Pontoon Solutions, there is a dramatic transformation underway in how we think about work. “What we’re seeing is the unprecedented rapid change in speed, complexity, and transparency in the job market … Both companies and job seekers are seeking ultimate flexibility in their engagement model with each other,” says Wachholz.
The gig economy is about flexibility. Employers can access the type of talent needed on demand in various markets and various regions. Workers no longer have to work onsite as full-time employees. Wachholz says, "You have the ability to leverage part-time workers, freelancers, both in-country and out-of-country—onsite, offsite. It really opens up the landscape for a deeper talent pool for an organization."
One obstacle facing gig workers and companies alike is the current regulatory environment. The way that workers are classified today is a challenge for a lot of organizations. According to Wachholz, the regulatory environment in North America has some catching up to do with current demands. Uber faced aggressive lobbying and litigation by taxi companies. Part of Uber's success was how rapidly it grew, which in turn was because of its tremendous popularity.
Bridging the expectations gap
For many workers in the new economy, it's not necessarily going to be an easy transition. To adapt, workers are going to have to change the way they think about their careers, both in terms of directions and what they should expect from organizations.
This creates a gap between the expectations of workers and employers. However, Wachholz believes that gap can be closed if both sides are flexible. "We all want mobility. We all want to have a good, transparent relationship with our work and our employees," he says.
Leveraging the human cloud
Just as cloud computing has transformed the way companies store and process data, the gig economy leverages people in a way that wasn't possible a decade ago. Wachholz calls this the "human cloud."
"If you look at the engagement model today as a worker—as a job seeker—there are a variety of ways for me to reach employment with companies. I can be part-time or full-time, onsite or offsite. I can be a contract worker, so I can work in a part-time or full-time capacity. I can also be a freelancer or a gig worker—working from home or remotely or from a different country. This variety of engagements is really providing companies with a cloud of services to consume from."
Not every business can simply copy the Uber model, but it's changing expectations about how businesses can engage their customers. "It’s forcing us to really rethink about—as employers, employees or workers—what does that engagement model look like?"