A "Gig Economy" is an environment in which temporary positions are common and organizations contract with independent workers for short-term engagements. In short, more temporary jobs and less full-time jobs.
I read recently that Intuit predicts that by the year 2020 40% of American workers will be independent contractors. The current percent of temporary employees is less than 5% according to the US Department of Commerce. This prediction just about floored me, but when I started thinking about it, it makes sense. Here is why...
First, the workforce is becoming much more mobile. Many jobs today can be done anywhere, anytime and anyplace. Digitization today allows for fast and easy access to data. I can securely see the same information I need working from my home office versus sitting in a traditional brick & mortar office..
Second, as the millennial generation becomes more dominate, this type of work and work schedule, better fits many individuals within that age range. The demand for a better work-life balance appears to be much more important than it is for previous generations.
Third, as the federal government mandates more employee laws on businesses of all size, many businesses won’t be able to afford it. Some that can afford it won’t want to. In a gig economy businesses save resources in terms of benefits, office space and training. They also have the ability to contract experts for specific projects who would normally be too expensive to have as permanent staff.
According to Eurostat approximately 12% of the work force in Europe is now temporary. Spain itself is over 20%.
So what does this mean? For someone like me at the age of 53, it's hard to wrap my mind around it. That being said, it hasn’t been all that easy for me to see the rapid changes that have occurred over the past few years. It’s not all bad and not all good, but for someone who enjoys change like me… it’s still too much too fast.
I don’t believe that we will be at 40% in the year 2020, but I do believe that we will be closer to that figure than what we are at today. Fasten your seatbelts.
Scott Huedepohl is the President of Community State Bank, and has been a community banker for over 30 years.