I’ve been an independent worker for most of my career. When I first started my business in the late ‘90s, freelancers were primarily found in the domain of journalism, (my initial profession), and other creative fields. Temp agencies have, of course, long helped firms fill gaps in administrative roles on a short-term basis. Given the popularity of freelancers today, however, it’s hard to believe that management consultants are among the only contingency workers identified as a class of professionals under the original North American Free Trade Agreement (NAFTA).
Gig workers are on the rise
The overhaul of traditional work environments has seen a rapid increase in the number of gig workers. Gig workers, also known as freelancers, consultants, contractors and contingency workers—now make up an estimated 20-30 per cent of the workforce in the U.S. and Europe. Half of companies globally have increased their use of contingency workers in recent years, and 40 per cent expect to add more freelancers to their talent pool in the next five, according to a survey by EY Global. Moreover, nearly half of the millennials, who now dominate the labour force, have either a part-time or full-time freelance job.
There are a number of things contributing to the rise of gig workers:
- Digital technology has completely redefined traditional work arrangements to gain a competitive advantage. Firms no longer require employees, even those on the same team, to be in the same geographical space.
- The average firm size is smaller. Companies don’t always have the expertise in-house to implement their growth strategies.
- Organizations need to be agile to compete. Adapting to rapid shifts in customer demand means having the ability to scale up or down quickly.
- Firms frequently need access to highly-specialized workers.
Companies are now finding that using gig workers can offer a huge benefit to their competitiveness.
1) Gig workers increase capacity
Short-term contractual arrangements mark the primary difference between employees and consultants. Between searching, recruiting, contract negotiations and onboarding, it can take a long time to hire a new employee. Consultants, on the other hand, can usually jump in and help you ramp up quickly. Instantly boosting your capacity on special projects or at peak periods throughout the year can keep you operating at a steady pace, by allowing your employees to focus on core operational work.
2) The talent pool is global
Depending on your requirements, freelancers can be sourced from all over the world. This can be a huge benefit for firms having difficulty overcoming the current talent crunch in Canada. If work can be done from anywhere—like many writing projects—it’s much easier to set up a contract with an independent worker outside Canada than it is to hire someone internationally.
3) Access highly-specialized skills
Consultants often bring a unique and specialized skill set. This can help you fill in gaps in your employee talent pool. Small organizations can use specialists—like IT consultants or digital marketing experts, for example—to help establish new systems or strategies. Overseas brokers on contract can help you establish a customer base in other countries.
4) Consultants help keep costs down
Although it can seem expensive to hire a freelance worker, keep in mind they only get paid for their actual working time, depending on the contractual arrangement. Flat fee or time-limited arrangements can help you rein in costs on special projects. Consultants also significantly reduce overhead for your organization because you don’t have to account for vacation days or other employee down time due to sick days. It’s expensive to make a bad hire. Freelancers tend to work at a pretty fast pace. But if they’re underperforming or don’t mesh with your team, you aren’t legally obligated to give them notice beyond what’s written in the contract.
5) Freelancers may become your employees
The majority of contingency workers (66 per cent) say the benefits of freelancing outweigh full-time work, according to EY Global’s study, which means most of them aren’t actively perusing career sites. Reaching out to specialized freelancers may help you proactively reach talented people that aren’t knocking on the door. That means, when you’re ready to make the big hire, you’ve got a number of potential and proven candidates already in-house, which can shorten recruitment time.