Skills Shortages and the Future of Work: Fixing a Broken Record

“This is the age of the gig economy”. “Say goodbye to talent gaps”. “Welcome to the future of work”. Over the last five years, statements such as these have dominated the labour landscape. The ‘gig economy’ is, without doubt, one of the biggest trends to have emerged in recent years, and its ubiquity is set to remain for some time yet.

It might seem like hearing a broken record, but the world of work is unquestionably changing, and fast – the global gig economy is now worth over USD 5 trillion, and reports suggest that on-demand talent will account for over 40% of the global workforce by 2030. The gig economy has been heralded as the answer to the persistent problems of skills and talent shortages, the precipitant of the continued success of the jobs market, and a boost to the global economy.

 

So why, then, do 40% of hiring managers feel that hiring has actually become more difficult over the last few years? Why are 75% of CEOs still placing talent shortages as their major source of concern for 2020? Why aren’t businesses fully embracing the ‘future of work’, and why is this ‘future’ still a pipedream as the new decade arrives, and not a reality by now?

 

On one level, the answer lies in the fact that gig economy has grown so rapidly, that confusion has naturally arisen as to what this phenomenon actually is, how it functions and just what impact it might have on business. Uncertainty breeds scepticism. The repetitive churning of data reports and blog articles championing these developments amidst the confusion doesn’t help either – if you get told that you’re going to love something enough times, you will inevitably come to despise or fear it.

 

The only way to break through those clouds of uncertainty is to offer some clarity and direction, to ensure that the workers of the future and the ‘future of work’ are heading in the same direction. So here goes:

 

What exactly is the gig economy?

 

In essence, the gig economy is one part of the wider collaborative economy that has emerged with the development of technology, enabling access to labour and assets in non-traditional forms.

 

Access to these assets and workers can be provided by digital staffing platforms, like Talmix, connecting workers to the right jobs whilst reducing the time-to-hire for businesses. This emerging set of online labour marketplaces, where talent and those looking to hire talent, can find and engage one another in a work arrangement, is part of the Human Cloud, an emerging set of work intermediation models that enable work arrangements of various kinds to be established and completed.

 

The technology here really underpins the work of digital staffing platforms. Online job boards and social media platforms are not included in this category, since they do not possess the data-led, matchmaking functionality inherent in digital staffing platforms like Talmix, nor can they enable or support work arrangements through to their completion.

 

It’s easy to think of the gig economy and the Human Cloud as simply the marketplace for independent contractors, and not employees. We associate the terms with companies like Uber and Lyft, and we think of cheap labour, temporary freelance ‘gigs’ and worker dissatisfaction.

 

Yet this is just one segment of the human cloud landscape. Online staffing platforms are a completely separate entity, enabling workers to enter into, complete and transact work arrangements anywhere in the world. This is not just to enable part-time gig work, but to creating a blended workforce that consists of both part and full-time employees; consultants, contractors, freelancers, project work and permanent positions.

 

Is this really the direction we’re heading in?

 

Yes. This is not a passing trend. In a recent survey, 31% of business leaders acknowledged using digital staffing platforms to source workers in the last 12 months. Furthermore, 67% of CEOs have indicated a desire to source workers in this manner in 2020. Businesses are having to adapt to new worker expectations also; many workers are trading in their regular 9-5 jobs in favour of interim or project work, or permanent positions on their own schedules.

 

The journey has already begun. The gig economy has huge value for people who are ready to embrace a more flexible future workplace. Those who continue to ignore these developments will inevitably fall behind.

 

So why the slow pace of change?

 

If businesses are aware that the gig economy is the future of work, plugging global skills gaps and boosting the global economy, then why are 50% of businesses still citing skill shortages as their major concern heading into the new decade? Something doesn’t add up.

 

First and foremost, many businesses simply don’t know how to begin the process of building the ‘future workforce’. It’s one thing to be told that change is afoot, but another to recognise how to embrace it. Some businesses lack the processes and infrastructure to support and navigate change; some struggle to see the value of new working alternatives in addressing strategic challenges; some mishandle these new worker relationships and changing expectations; some are simply reticent to hire outside of the company and struggle to move beyond out-dated preconceptions of freelance workers.   For more on these issues, and for advice on helping your business begin building the fluid workforce that will best prepare it for the future, here’s something we made earlier.

 

Between 2014 and 2018, 3.7 million more people started freelancing in the US alone. With so many skilled workers on the doorstep, we should not still be talking about the challenges of finding workers. Undoubtedly, part of this discrepancy lies in the fact that many businesses still remain burdened by some ingrained stigma that renders them painfully reluctant to tap into this growing global network.

 

We’ve debunked all the myths of hiring freelancers here, but it is worth re-iterating that freelancing has unequivocally evolved from cheap labour to top talent. In the past, freelancers were indeed contracted to reap the cost benefit of utilising lesser-skilled workers to execute non-core functions.

Today, freelancers are instead tapped as a source of niche talent and expertise by companies that are struggling to source on the traditional labour market – the minute businesses recognise this reality, the faster they can unlock the monumental potential of this resource.

 

What are the other concerns?

 

Ultimately, there will always remain a concern over whether employers can guarantee access to the highest quality of talent, when tapping into the flexible workforce. There’s the apprehension of putting your fate in the hands of a digital staffing platform, of doing away with traditional organisational structures; there’s the worry of ensuring that contingent hires will be dedicated to the employer brand, or will have the requisite experience, or will fit the culture, or will prove cost-effective. Are freelancers only good for short-term projects, is the hiring process too long, will the process require new protocols, how do I know which staffing platform to trust?

 

There is certainly a case to be made that these concerns have been inadequately addressed in the race to promote the virtues of embracing the extended workforce and the values of digital staffing platforms. A case of shoot first, ask questions later.

 

This is something that we’ve recognised at Talmix – so we’ve created a landing page specifically designed to respond to all these concerns, to reflect upon the reasons why businesses are struggling to cope or embrace the pace of change, and to help businesses understand the full extent of what managing a blended workforce requires; quite simply, we want to set that broken record straight.

 

After all, until businesses are either confident in their understanding of the machinations of the gig economy and its impact, or are willing to put aside their misapprehensions, misconceptions and misgivings over embracing its value and that of the flexible workforce, the skills gap will not be plugged any time soon, and the ‘future of work’ will remain an unrealised utopic pipedream.

 

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