Australia’s gig economy – are you & your business ready for it?
4.1 million Australians or almost one-third of our workforce is engaged in freelance work according to an Upwork survey. On-demand or contingent workers, independent contractors, self-employed or freelancers – there are many names for this growing pool of talent who form what is being called the gig economy. With significant advances in technology and more flexible working practices across all industries, people now have the option to adjust the way they work to better suit their life.
In fact the majority of Australians in the gig economy say they originally started freelancing by choice, rather than necessity. According to Upwork’s research, more than 60% agree that freelancing provides them with the opportunity to work from anywhere – and more than a third (43%) said they’ve been able to move to a different location because of the freedom freelancing gave them. ADP Research Institute’s Evolution of Work – The Changing Nature of the Global Workplace supports this with 74% of surveyed Australian respondents saying ‘they will be able to work from anywhere in the world’.
Evaluating the gig economy tends to raise two big questions for most employees and employers.
1. Is it the right career move for me?
Becoming your own boss is certainly easier than ever before, with the explosion in “on-demand” services such as Uber, TaskRabbit Upwork and Freelancer.com. However, qualifications, competition and bid structures should be taken into consideration. It is also worth taking a closer look at the pros and cons to understand whether freelance or self-employment is really right for you.
The downsides include a lack of legal rights and employment benefits, from holiday to sick pay and pension. While a steady pay cheque and employment stability do have their benefits, a significant percentage of those who are already self-employed report high levels of job satisfaction. Before making the leap to a freelance career you should ask yourself these questions:
- Is there a market for what I do and who am I up against?
- Do I have a potential list of clients I can work with?
- Am I financially stable enough to embark on this journey?
- Do I understand the business and regulatory landscape of setting up a company?
- How will I plan for retirement and potential health issues?
- Would an alternative such as a flexible or part-time contract with my current employer be a better fit?
- Can I work in isolation, without colleagues?
- How will I ensure my own professional development without career pathways
2. How do employers meet the demands of the gig economy?
From an employers’ perspective, there is no hiding from the rising tide of flexible working demands. Offering flexible working arrangements can help to combat stress, improve employee morale and boost productivity. At the same time, the ability to tap into a wider pool of candidates when you need it provides new opportunities to bridge any skills gaps. However, legacy tools and error-prone systems struggle to support this transition. For example, fragmented, out-dated or inadequate HR and payroll tools can reduce your agility and pose a risk. With an estimated 70% of operating costs coming from salaries, overtime and other compensation* – any payroll error could be a significant risk to your profitability and growth.
For many Australian employers, the gig economy is no longer an isolated phenomenon that’s just relevant to a few selected roles or locations. Find out how you can leverage ADP’s expertise to simplify payroll, time capture, rostering and leave management – and help your business benefit from the change.
*’The advantages of workforce management’, 2014, HR Magazine
Written by: Connect@ADP Team