The term “gig” has made an interesting transition from entertainment to economics. What used to be a cool term for a performance is now a cool term referring to a specific segment of the economy.
Don’t worry, you can still use the word if you’re going to a rock concert. But if you want to know what the gig economy has to do with your business’ staffing needs, keep reading.
What Is the Gig Economy?
The term “gig economy” describes the modern phenomenon of businesses hiring independent contractors or part-time workers instead of full time staff.
While it’s not a new idea (contractors have been around just as long as employees, if not longer), it’s true that over the last decade, the number of independent contractors has grown steadily.
According to a recent study, the gig economy represents 34% of all US workers, and it’s expected to grow to 43% by 2020.
The gig economy represents 34% of all US workers, and it’s expected to grow to 43% by 2020.
There are many reasons why the gig economy is becoming increasingly popular. It gives flexibility to contractors and helps businesses save money, since contractors tend to be “cheaper” than full time employees.
On the other hand, the main disadvantage of the gig economy is that it fails to bring stability. Neither the contractor, nor the business has the security of employment, which means that jobs and workers can come and go faster than full time staff.
Workers face a lack of job security, while businesses need to constantly train new contractors, wasting time and money.
Is the Gig Economy Good for Your Business?
The answer is a very clear “maybe.” Your business has access to a large pool of independent workers. This includes global contractors as well, since because of the internet, many jobs can be done remotely.
On the other hand, if you rely too much on contractors, you may find yourself understaffed at a critical moment when all your part-time contractors have other gigs to attend to.
The solution to this problem is finding the middle ground. Analyze your staffing needs and identify key positions. These are the workers you absolutely need all the time. Hire them full time to ensure your business’ smooth operation.
Analyze your staffing needs and identify key positions. These are the workers you absolutely need all the time. Hire them full time to ensure your business’ smooth operation.
The rest of the positions are jobs that are less important for the core tasks of your business. For example, if you’re operating a small retail business, you need at least one person manning your shop.
What you probably don’t need is a full time accountant. Instead, you can hire an independent contractor to help you with taxes and financial management for a few hours each month.
So Do You Still Need Full Time Staff?
The answer to the titular question depends on the size of your business. If you can do all the core tasks by yourself, you probably don’t need full time staff, only a couple of part-time gig workers to take care of extra assignments.
If you need help with the core tasks, hire full time staff to ensure the smooth running of your business. You can still outsource the rest of the tasks to contractors.
Paying your contractors may become an issue, especially if you’re working with people from overseas. Sending international wire transfers through your bank is costly and time-consuming.
Instead, try Veem.
Sign up for a free Veem account and enjoy easy global payments.