How the Gig Economy is Promoting Entrepreneurship?

Gig Economy

Gig Economy

The gig economy upended the dynamic between companies and workers.

In the current scenario, the corporate landscape is experiencing a significant transformation. Most large businesses are now turning and investing in small businesses to expand their horizons and create a new revenue stream. Over the last few years, we have seen a new emerging market ecosystem, the gig economy. Gig economy workers can be seen in every sector, including graphic designers, app and web developers, accountants, legal experts, and translators, among others. While the incorporation of digital business technologies continues increasing, the economic landscape has transitioned from a static, long-term employment-focused model to a newer short-term, contract-based one.

According to a McKinsey Global Institute study, 150 million workers in North America and Western Europe are working outside the confines of a conventional full-time job. The report further found that the on-demand economy is becoming a new phenomenon for employment. The gig economy allows a worker to explore his/her passion and see if it is something more than a passing fancy, without losing their primary source of income.

 

Gig Economy and Entrepreneurship

Beyond giving opportunities to small businesses to perform independently, the gig economy is changing the way how entrepreneurs create jobs and hire workers. Moreover, collaborative, sharing and gig economy-based businesses have paved the path towards a new paradigm where businesses operate by luring freelance entrepreneurs.

As noted by Forbes, contractors are people who worked mainly in blue-collar industries. But now, anyone can be a contractor from a welder to a writer and web designer. Even traditionally in-house roles have gone the way of the gig, propelling companies to adapt to their employees’ changing needs. A report shows that 85 percent of companies plan to make a transition to a more agile workforce in the next few years. This increasing interest in freelance work has also led to the creation of a new kind of business: service aggregators. These online marketplaces, such as Amazon and TaskRabbit, connect customers to service providers in their area, allowing freelance and gig workers to capture demand.

The gig economy is mainly attracted by millennials as they prefer to work independently and want more flexibility. They can find work through evolving digital platforms, which propose a work-for-hire recruitment model. Using these platforms, such freelancers can create profiles, and market their services for a rate based either per hour or per contract. As these digital marketplaces evolve further, more and more professionals are becoming attracted to freelancing.

The shift to a gig economy is occurring faster than our imagination. According to Randstad Canada, 20-30 percent of the Canadian workforce already encompass non-traditional workers. On the other side, PricewaterhouseCoopers reported that 53 percent of all surveyed workers answered in the United States expected to be self-employed in the next five years.

Comprehensively, the gig economy in the modern technological innovation era is assisting to connect businesses to key specialists, helping them at key stages in their business’ development.