To Remain Competitive in the Gig Economy, Companies Must Rethink how they use Labour

A recent study found that governments in the U.K. and Europe have been underestimating the actual size of the gig economy.

By Sam Smith, Global Vice President, Life Sciences & Healthcare  |  December 05, 2016

Despite the fact that workforce experts have been discussing the rise in voluntarily independent workers for the past eight years, a recent study by the McKinsey Global Institute found that governments in the U.K. and Europe have been underestimating the actual size of the gig economy.

The findings of the study were published in an October 2016 report titled “Independent Work: Choice, Necessity, and the Gig Economy.” The study found that 26 percent of the U.K. workforce is currently made up of independent workers—almost twice as much as the 14 percent cited in official data. Furthermore, it revealed that while between 10 and 15 percent of the EU-15 labour force engage in independent work to generate supplemental income, another 10 to 15 percent rely on independent work as their primary source of income.

It’s important to understand that a significant number of these independent workers are highly skilled professionals in the STEM fields who don’t want a full-time, conventional employment contract. Instead, they want defined-term contracts that allow them to move from project to project according to their career needs and preferences.

The natural resources industry is one of the numerous sectors impacted by this rise in independent workers. With many Baby Boomers leaving the full-time workforce, there are relatively few Gen X workers available to move into those vacated senior positions. This is further exacerbated by the fact that an increasing number of skilled and experienced professionals from each generation—Baby Boomers, Gen X, and Gen Y—are choosing to become independent workers.  

It’s clear, therefore, that employers that want to attract top talent need to look beyond the conventional labour force and rethink how they use labour. Especially in the current marketplace, where innovation is critical to remaining competitive, they must include specialized independent workers in their workforce strategy. Additionally, since these highly skilled professionals can be located literally almost anywhere in the world, employers have to consider the fact that they can access the talent they want—but some of these people will want to work virtually.

Both of these points are a significant about-turn for an industry that’s traditionally been highly protective of intellectual property (IP) and company secrets. And both points have significant implications for employers. First of all, the specialized talent they need is in high demand. That means these individuals will be working for other companies—potentially the competition—before and after their gig. And while this might seem to some like a nightmare in regard to IP and confidentiality, the reality is that employers have to find a way to navigate these legal challenges. At the same time, companies must develop the ability to create collaborative work environments—on-site, virtually, or a combination of both—where teams consisting of a range of different categories of workers can collaborate effectively. If they don’t do this, they’ll likely forego their chances of attracting top talent and as a result, adversely impact their competitive positioning.

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