The so-called “gig” economy is booming. Companies are dealing with new economic realities that encourage them to hire freelancers and part-time workers, rather than full-time employees who are eligible for benefits and overtime. And in the meantime, apps and other tech influencers help workers who prefer project- or gig-based work, rather than full-time jobs.
“This year alone, human-resources startups have attracted $1.2 billion in venture capital, with much of the funding going to companies designed to profit from the fluid nature of temporary or contract work,” writes Gabrielle Coppola for Employee Benefit News, citing research from CB Insights.
So, how will your company balance this influx of potential work? Here are three factors to help you make the gig economy work for your business.
1. Understand Freelancers’ Motivations
Gig workers should be looking for transparent information up front about length of project, pay, and their responsibilities.
And, understand they’ll ask for compensation differently than your full-timers who are earning salaries and benefits. Maggie Mertens, writing for the Seattle Times, advises freelancers to ask for a rate three times what they’d expect to make working full time.
“In terms of financial goals, freelancing and contract work can be very different from full-time,” Mertens writes. “You have way more overhead… you pay your taxes, your own 401(k), your own health care.”
2. Use Tech to Your advantage
Uber’s app-based ride service is famous for its cadre of gig-based workers, but more apps are becoming available to help companies and workers connect.
One example: Snagajob, which evolved from an online job board.
“It has nearly doubled revenue derived from employers in the past three years,” Coppola writes. “It claims 10 million unique monthly users. … It charges employers for the number of clicks, applicants, interviews and hires it lines up. It also sells annual subscriptions for use of its hiring software.”
Such apps can help your company find and hire the right workers.
3. Recognize the Economic Power of Freelancers.
The number of people participating in gig-based work are contributing a huge amount to the economy, writes Akin Oyedele for Business Insider. But, they’re still being excluded from monthly U.S. jobs reports from the Bureau of Labor Statistics.
“The bureau has been counting so-called gig workers since 1995, long before companies like Lyft and Uber existed,” Oyedele writes. “But because of a funding shortfall, it has not been able to conduct a survey on them since 2005. It plans to do a one-time count in May 2017 if Congress approves funding.”
Don’t make the same mistake — these workers could have quite the impact on your bottom line, so make sure your company takes them and their work into account.