Technology changes the workforce. This is not a new phenomenon, but we are seeing the latest iteration of what happens when technology grows and advances to the point that the old way of doing things has, in many ways, become obsolete. Thanks to digitization, increased communication capabilities, and the pressure on businesses to deliver more options with fewer resources, we find ourselves looking right into the eyes of the gig economy. And, rather than shying away, it seems that employers have opened their arms wide, and embraced this model for recruiting new talent, shaving cents off the bottom line, and getting the job done.
The March of The Freelancers
The word “freelance” was coined by Sir Walter Scott in 1820 while he was writing Ivanhoe. The word refers to traveling mercenaries in the middle ages; warriors whose lance were for sale to the highest bidder. By the 1880s the term had also come to refer to journalists who sold stories to different publishers, but who were not on staff with any of their paymasters. Over time, the term expanded even further to refer to any individual who works on a per-project basis without being an official staff member for their employers.
Being a freelancer (or an “independent contractor” to use the parlance of the day) isn’t new, but it is becoming significantly more common as more companies embrace the gig economy. The idea is, simply put, that it is often cheaper, and more efficient, to hire freelancers whenever you can. If you need content written for your website, post a job and find a freelancer with experience in your field who specializes in making the content you need. If you need a video made, some code written, or a marketing packet put together, you can turn to the huge pool of freelancers (many of whom are experts in the field), and hire them to complete the task you need.
There are even tasks we once thought of as company jobs that have become part of the gig economy thanks to technology. Uber, Lyft, and other companies have allowed anyone to act as an independent contractor when it comes to ferrying people from point A to point B, as long as they have a car and the app.
The Benefits For Companies
The major benefits of hiring independent contractors are that companies can focus their resources on getting the best talent for the best cost. It also minimizes expenses, in that companies do not have to cover salaries, benefits, office space, and other costs that come with hiring regular employees. Combined, this creates a focus on the final product that can allow a company to get significantly more bang for its buck.
While it’s true there are always going to be regular employees, there are some who have underestimated the gig economy. According to CIO, it’s been estimated that as much as 40 percent of the workforce will be freelancers by the year 2020. Part of that is a direct result of the changes and cuts made during the Great Recession, part of that is the shrinking of the world thanks to technology, and part of it is that more businesses have realized it’s possible to hire freelancers to do a greater variety of jobs.
The birth of the gig economy was caused by myriad factors, but there is one, indisputable truth about it if one looks at the numbers. It isn’t going away anytime soon, and it is more likely that freelancers are going to be in an increased demand, rather than a decreased one if the trends continue the way they’ve been going.