Impact of gig economy on talent recruitment

The onset of the gig economy has led to the practice of recruiting talent “on-demand” that utilises non-permanent human resource to undertake tasks and services.

Gigs are actually not new. Traditionally, they referred to music performance by a band in a night club or café, for a short spell. Today, any form of freelance job is considered part of the gig economy. And many employers are finding it beneficial to offer gig-based rather than permanent jobs. The implication is that the workers are not classified as employees, and their service is based on a pre-determined duration of work.

A substantial minority of the Millennial Generation (now mostly in their mid- to late-20's) prefers this short-term arrangement which gives them the flexibility to move on to other commitments once the gig is over.

According to Mr Lim Swee Say, Minister for Manpower, there is no official definition of the gig economy worldwide. He quoted the OECD and several international studies that commonly refer to workers in the gig economy as "workers on the platform economy. These are online labour-sharing or capital-sharing platforms. These online platforms serve as intermediaries to match or connect services buyers with workers who take up these short term or piecemeal jobs. So, there is matching of supply to demand."

Read more on Mr Lim's speech on March 6, 2017

There are however risks and challenges that employers have to consider as they weigh the pros and cons of “temps vs. perms” arrangement. From the perspective of a HR practitioner, some of the key areas are:

Security. The business using gig-based service has to have security and confidential information ring-fencing. Freelancers should be subject to data security checks just like permanent staff. There must also be policies in place on the access to sensitive business information by the freelancer.

Quality of work. Unlike permanent employees who can be sent to mandatory training, part-timers do not have such access. Hence, there is no guarantee on the quality of the work, nor are there serious consequences for uncompleted work (other than refusing payment and giving negative feedback).

Competency-building. One solution would be for the part-timers to continue building up their competency by acquiring new skills and knowledge. Depending on their interest, there are a wide and diverse range of courses available. For those who aspire to move up on the HR track, check out this link to courses available at Human Capital (Singapore).

To continue the conversation, Human Capital (Singapore) plans to organise sharing sessions where you can exchange ideas, experiences and observations with other HR practitioners. Stay tuned!