ALMOST a third of employers will be turning to the “gig economy” to find staff in the next five years.
Bournemouth-based Jobshop UK has been advising clients about the pros and cons of the phenomenon, which involves sourcing freelancers and self-employed individuals as required.
Six per cent of UK employers are already using such methods and 29 per cent think it will be important within five years, according to the Recruitment and Employment Confederation’s (REC) Gig Economy Report.
The REC describes it as the “Uberisation” of work, after the taxi-booking app that epitomises the use of digital platforms to source self-employed workers.
Frances Miles, director at Jobshop, said: “The gig economy has a number of benefits to the employer, such as speeding up the recruitment process, offering access to a global candidate base, and reducing the cost of permanent hire.
“The employee benefits from increased flexibility, being able to set their own price/fee, and again, being opened up to a global marketplace. However, there are potential disadvantages and it’s important to weigh these up.
“Limited screening regarding ID, qualifications and eligibility to work, could lead to problems for the employer, as could a lack of compliance and protection, including confidentiality and industry standards.”
“There is no guarantee to the quality of work produced, and a potential lack of loyalty could again prove troublesome for the employer.
“An employee on the other hand risks feeling devalued of their own worth through the inevitable highly competitive pricing matrices. There would be no workers’ rights, security, pension contributions, or any guarantee of continuous work, making job security almost non-existent,” she added.
“Many workers could understandably end up lacking a sense of belonging, which as most employers will know, is a vital attribute to loyalty and productivity within a business.”
There are also concerns about the strain the gig economy could put on the pensions system.
Employers have to sign up to a pension scheme to which both they and their staff contribute.
But research suggests freelances do not save for their future because their income is less secure.
Frances Miles added: “Nothing will ever replace the human touch when dealing with people, and a good recruiter spends time understanding the needs of both the employer and employee to enable a deep understanding from each side’s real needs and motivations, as well as often being the mediator between both parties – managing expectations, individual concerns and ensuring a good outcome for everyone.
“The gig economy is here to stay whether we like it or not, but the danger lies in the freedom of companies to treat workers as an extension of sophisticated tech rather than as people.”
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