The Evolution of the Gig Economy

The birth of the “Gig Economy”
In recent years we have seen a rapid spike in the number of freelancers and independent contractors. While freelancing has been around for decades, the recent increase (more than 30% in emerging economies, to be exact) can be attributed to a changing economic climate and a switch in generational trends. Millennials place a higher importance on flexible work schedules and passion towards work more so than salary, which can be seen with the rise in the gig economy. Gig Economy refers to a general workforce environment in which short-term engagements, temporary contracts, and independent contracting is commonplace. In other words, temporary positions tend to be the norm and job roles are based off of individual shift assignments and different tasks. Those who are accustomed to a more traditional role might be skeptical. However, many people are leveraging the flexibility of this type of work which allows them to make sufficient income all while creating their own schedule. These new types of companies bring convenience and on- demand services, the ideal model for the modern consumer.

Although unconventional, these startups have taken over the world and have integrated into our everyday life, providing newer and more efficient ways of doing practically anything. Think Uber, which completely disrupted the taxi industry, sparking a totally new marketplace of shared ride services. This is a great example of the modern day “gig economy” because each drive or “job” a driver accepts is a different task and they can choose to complete however many they want. Drivers get to be their own boss, choosing to work part time or full time, making this the perfect side hustle or even a main source of income for those who are willing. Airbnb, Lyft, Uber Eats, Postmates, Favor, and many more are all great examples of companies that have created a name for themselves in today’s gig economy. While we are all more than familiar with these new household names, their rapid rise has resulted in a bit of confusion due to the wide net cast by this term. The confusion stems from other jobs based off of short term engagements--such as plumbers, contractors, technicians, electricians and mechanics--getting classified under the same “gig economy,” umbrella, despite their need for specific qualifications, certifications, and accreditations.

All Gigs are not created equal

With the gig economy booming now more than ever, we should explore how to differentiate the two types. Consumers undoubtedly demand a basic level of trust from companies when using services such as Uber and Airbnb, i.e. background checks. However, the qualifications for other services, most of the time, demand much more than that. The typical consumer would probably not hire an electrician if all that professional  had to show for was a background check and not one of the many certifications that electricians must have. But because most companies DO only hire employees who hold these-up-to date certifications, how do they highlight these qualifications,  differentiating themselves in this modern gig economy that is so widespread?

A case for change

The journey begins with developing best practices formulated for your type of work. In doing this, you will ensure that your company will have the best ways of working to achieve your business objectives. Creating appropriate standards for your work enables a company to work within a specific criteria and maintain a certain level of quality. Not only will this reduce costs and be a more efficient way of running, it will elevate the skills of the overall workforce. Having a workforce with a baseline of skill and knowledge operate under a structured set of specifications will be a surefire way of giving customers a quality product or service. Benchmarking lets you compare your business to other successful businesses so you can assess what works well and where you can improve, allowing for a healthy competitive behavior to push the business to higher standards. Holding best practices at different levels including IT, Sales and Marketing, and Business Operations is also beneficial so that everyone can pursue the overall business objective.

Best practices can be much deeper though, and should also include a higher purpose for the business so that employees can work towards the shared vision. Creating a brand mantra is powerful because it encapsulates the entire business purpose and simplifies it into its most necessary form. Open communication among all levels will allow visibility and a way for those in senior positions to get feedback and adjust accordingly. Creating an engaging workspace will prevent employees from feeling alienated and will help them care about the company vision. Rewarding effort can let employees feel valued and will increase loyalty to the company. While the list goes on, creating a standard of best practices for companies with a model such as Wrench--which has skilled labor that works full time--is essential. Delivering a product or service with the appropriate qualifications that back up your right to do so, is the ethical standard that these businesses must have. The level of trust between the business and consumer that is then created will allow your business to flourish naturally.

A new class is born

All of these factors will ultimately differentiate worthy businesses in this hectic gig economy. But the question remains on how we can further differentiate the types of businesses within the gig economy that require a different degree of skills and certain accreditations, from those who don’t. Since the gig economy is now so massive, perhaps it is wise to create a new term to identify those businesses, ensuring that the skills and knowledge of trained workers are not undervalued and do not go unseen. Therefore, “gig economy” might be best to narrowly define the more commoditized services, e.g. walking a dog, driving part time, delivering food; etc. In contrast, companies such as Wrench whose technicians are company employees with over five years experience and ASE certifications, should be in a different tier. Our technicians are trained and knowledgeable, with proven track records of great customer service and quality work. It is important to highlight this, not to devalue the roles in the gig economy that do not, but rather to shed light on those that require additional formal training. To encompass this concept, a new “accredited” gig economy should be born. Thus, adapting to the fast-paced innovation the last decade has seen and diversifying the gig economy as we know it.