If you’ve heard of the term “gig economy”, you would also find that this term is commonly followed by adjectives such as “rising” or “growth”. For those who are late to this thriving phenomenon, this simply means that there is a drastic shift in the labor market. Gone are the days where a traditional “9 to 5” job is the norm. In fact, the connotation of this term is slowly shifting from traditional to outdated.
Instead of holding out for a Monday to Friday gig at an office, both the labor and the job market seem to prefer going down the independent contractor route. Economists Katz and Kreuger found that all job growth in the US since 2005 are due in part to “alternative work arrangements” (paper forthcoming). While there are many logical reasons as to why the gig economy is taking off, One of the most fundamental reasons is that hiring full time employees to get a job done is quickly becoming overrated.
Sledgehammer vs. Nutcracker
For a business to run smoothly, there are many different job functions and roles that need to be filled simultaneously. But does getting a job done mean having to bring on board an entire team of full time employees? Probably not.
You do not need to hire a full time tax preparer when you only need your taxes done once a year. Nor is it logical to employ an in-house designer if you only need a simple illustration done. Depending on the needs of your business at any given time, wouldn’t it then make sense to employ professionals on an as-needed basis? The labor market says yes.
Millennials, who are making up the majority of the workforce today, are changing the rules of employment. In a recent study, 69% of millennials have polled that they preferred either being a freelancer, an independent contractor, or a temporary worker over being tied down to a single company for the long term. Besides having to attract millennials to take on full time positions, retaining them will prove to be yet another challenge when traditional benefits no longer motivate them.
Tough Nuts to Crack
While full time employees come with the added benefit of having someone there at your disposal whenever you need them, this convenience also comes with a hefty price tag. Office space rentals, purchase of supplies and equipment, and employee benefits are just a few of the many factors that can drive costs up.
Millennials have also shown that they value relevant job training and retaining talents would require something more costly than monetary investments: Time. Independent contractors are typically professionals in their field and do not require any training from you.
If you’re looking for talented professionals to help you, this “alternative” arrangement may be one of the few ways to gain access to experts who wish to maintain this sort of flexibility in their lives.
On Cracking Nuts
Of course, this arrangement would only be a good fit and cost effective for certain positions in the company. The higher C-level executives and certain managers would most definitely need to be hired as full-time employees. Similarly, someone who is needed physically to count inventory cannot be virtual.
At the end of the day, it boils down to who you feel comfortable passing on your jobs to, and what kinds of tasks you are able to delegate that will ultimately be beneficial to your company in the long run.
Wondering what kinds of tasks are better for hiring virtually? Here’s a list to help you get started: 75 Tasks a VA Can Help You With
If you’re looking into hiring freelancers or independent contractors to help you fill the gap in your company or for certain projects, iVirtual Business Services can help! Our talent pool consists of professionals in different fields ranging from marketing to design and even business operations. Feel free to schedule a no-obligation 30 minute consultation to see how we can be a valuable resource to you here: Free 30 Minute Consultation
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