Gigging out: the tension between gigs and retention

Old_Time_gigThe gig economy is going to be ‘huuuge’, or so many speakers at the recent TAtech conference told us. It will comprise 40% (!) of the entire labor market…in 4 years. It will ‘change the face’ of employment. And yes – it will ‘revolutionize’ recruiting. (You just knew revolution was going to be in there somewhere, right?).

What exactly is the gig economy? As popularized by Uber, its most prominent employer, it is a way to money by doing ‘gigs’ – short bouts of independent work. You find out about the work – and are scheduled, etc. – via some sort of cloud-based software. You can be a driver, a delivery person, a dog walker – pretty much anything that someone else doesn’t want to do and is willing to pay you to do.

Sounds like a contractor without a contract, doesn’t it? You are a cog in a machine – not unlike many ‘regular’ jobs – but you must pay for your own health care, insurance, and so on. You are, in essence, your own employer and your own safety net.

Leaving aside the question of whether or not 40% of the workforce actually wants to live this way, the more interesting question for our industry is this: what about retention? If I had a nickel for every article outlining the many ways to retain workers, I would be a retired JobBoardDoctor. As we all know, employers want quality applicants, which means they want people that can do a job well – and stay. One of the ways employers lure employees to stay is through benefits and the promise of continued employment.

Why does an employer want an employee to stay? Simple – it lowers the cost of business and increases profitability. Instead of spending money constantly filling ever-emptying jobs (ask anyone in retail about this problem), you spend it on expanding your business. Instead of endless rounds of training and onboarding, your retained employees do their work well and predictably.

Of course, in the real world, it doesn’t always work out that way. But if specific people with specific skills make a difference for you as an employer, you do everything you can to retain them.

What does the gig economy focus on? The gig itself. The fact that a gig can be done by pretty much anyone, at anytime, ideally at the lowest price possible. It’s an equation in which the worker is simply not that important anymore. In a not-so-pleasant return to the past, it creates a new world of ‘piece workers’ who try to cobble together enough gigs to make a decent living – all the time knowing that they can be replaced at any time, for any reason. It also – and this is not surprising – exerts downward pressure on compensation. No matter if you are a highly skilled programmer or a college dropout with a car, once you start competing on a gig platform for work, you are also competing to do that work at the lowest possible price.

So there is definitely tension between the gig economy and the mainstream HR world. How will this tension be resolved?

Hey, don’t ask me! I just raised the question. The answer is up to you.

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This Post Has 3 Comments

  1. John Hoskins

    Jeff if this is what job boarders have sleepless nights about they are one revolution behind. Me thinks that “gig” is an old theme and doesn’t qualify as a trend but a fact of life today.

    What will reduce the field of full time employee applicants even more? Robots. They are easy source, offer service for a lifetime. As relatively tireless workers they require no benefits and rarely are tardy or absent.

    Perhaps a posting in the future.

    Robot wanted. Must lift 20000 pounds easily. Great maintenance schedule. Non union shop. Apply Now.

    See http://youtu.be/8_lfxPI5ObM

  2. Maddy

    I think there’s definite growth in the numbers of people who earn their living through freelance work (not necessarily app-ified employment through Uber or AirBnB type companies), to supplement their income or for all of their employment.

    To my mind, it ties in with the rise in remote workers/work-from-home options that employers offer. There’s flexibility to be gained at the expense of insecurity. But it’s definitely also a response to the major job losses after 2008, where a temporary contract for a finite project was better than no paycheque at all, and the mentality that no job is secure, and any “permanent” job you get is still just a temporary gig.

    It’s definitely not a one-size-fits-all solution, for workers or employers, and I imagine plenty of employers may view or treat so-called “gig” workers as regular, trusted freelancers, or even part-time employees. It’s where they stand on paper as contractor vs employee that things get muddy, as Uber has experienced.

  3. DH

    Until you are in the gig industry, it’s hard to understand what it is and how it works and the affects of it. More than half of gig workers actually have a full time job. They do this on the side, late hours, mornings, between shifts, weekends, etc. The gig work helps earn extra money, or help during unemployment times. A lot of these workers are making more than minimum wage and have provided a way to pay for those bills than your typical 9-5 job. Who doesn’t want a few extra hundred dollars a week by just driving a few hours? How is it affecting the HR world? I personally think it is changing how we look at the “work”. The typical 9-5 full time employee with benefits is being challenged. Why should only “full-time” employees get benefits? The only reason they are independent contractors right now is because that is the only way to conform with the current workforce policies and economics. Imagine how would you classify a full time employee that only works 2 hours a week? I don’t think gig workers are replacing jobs, but simply adding more opportunities to make money and disrupt the future of work.

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