The gig economy, characterized by the proliferation of freelance and contract work, has been a double-edged sword for businesses.
On one hand, hiring freelancers can save you money in the short-term, but if you are looking for a long-term solution, you might need to assess if the hidden costs will be sustainable for you.
The gig economy has seen huge growth in the past couple of years. Many businesses resort to this strategy to solve one of their biggest strains—talent shortage. But there’s also a lot of drawbacks associated with this.
Here are the most common risks you may encounter when hiring freelancers:
- Lack of commitment
Having a dedicated team can lower costs in training and lower effort when it comes to continuous output.
Unfortunately, freelancers are not bound by the same level of commitment as a dedicated permanent/full-time employees. This means that they can easily switch from one project to another, making it difficult for businesses to build a strong and reliable team.
- Quality control
Hiring freelancers can be a hit-or-miss proposition, with businesses never quite sure of the quality of work they’ll receive.
There is a certain investment in time and mentoring that one must commit to ensure the quality of the output, and this may take a bit of effort as you hire different freelancers.
- Lack of accountability
Freelancers are not held accountable in the same way as traditional employees. This can lead to missed deadlines, shoddy work, and a lack of follow-up. This can be a major problem for businesses, who are left to deal with the consequences.
Competition for Talent
In the post-pandemic world, jobseekers’ wants and needs are shifting. Many are now seeking autonomy over their careers, which leads to a high turnover rate in the workplace.
This is why the idea of gig economy has become so appealing to the modern workforce. To date, approximately 68 million workers in the US are in the freelance industry, and it is projected to reach 90.1 million in 2028.
As more and more people turn to gig work to make a living, it is becoming harder for businesses to find qualified full-time applicants for their open positions.
How to mitigate the effects:
- To attract and retain talent, make your offerings more attractive.
- Put important focus on the quality of life. In the current business climate, employees are choosing to do freelancing to be able to focus on their quality of life.
- Try offshoring
Offshoring is a much better alternative solution to dealing with this issue. By outsourcing some of your business’s tasks to professionals in other countries, you can find highly skilled and qualified workers who are willing to work for lower wages than their counterparts in your home country.
This can be a cost-effective way to fill your open positions without having to compete with the gig economy for applicants.
By working with professionals in other countries, you can gain access to new markets, cultures and languages, as well as new ideas and perspectives that can help your business grow.
Additionally, offshoring can also help you become more agile and responsive to the changing needs of your business. Having an offshore team to support the changing landscape is enough.
Intrigued with how this works? Book a conversation with us and learn how offshoring can transform your business.