Pros and Cons of The Gig Economy: Can Remote Workers Be Assets in Small Business?
Investor, Founder & CEO. MIT graduate. Co-Founder of Mesmerise VR, Marsfields, ARQ and Repeat.
Advancements in technology have made it possible for businesses to operate as normal with significantly fewer in-house staff.
The gig economy
is growing rapidly, with more freelancers and companies alike possessing the tools needed to quickly collaborate, share work and seamlessly communicate.
The driving force behind the growth of freelance work can be found in cloud computing, where just about anybody in possession of an internet connection across the world can effectively work for a business elsewhere.
(Figures suggest that the majority of US citizens will be engaging in some form of freelance work by 2027. Image: Website Planet)
As the cloud continues to leverage remote work, it’s widely expected that the gig economy will continue to grow throughout the 2020s. This can potentially be seen as good news for small businesses operating within a smaller working environment. With this in mind, let’s take a deeper look at the pros and cons for the gig economy, and explore whether remote workers can be an asset for small business owners:
Of course, the greatest asset freelancers bring to small businesses
is the lower costs. Not only do you get to save on the price of a salary, but also company perks, health insurance and office usage are saved.
This is particularly useful if you’re planning on scaling in the near future and need to keep on top of your budgets. Without the need for catering to fixed salaries, you can manage your company money much better.
The lower costs associated with hiring freelancers will always mean less risk, but it’s especially pertinent when you’re managing a startup
and the short term future of your business is not assured.
Since you only need to hire and pay freelancers when you have specific jobs to be done, it saves lots of time and money when compared to hiring somebody who may not always have a discernible workload on hand.
‘Downtimes’ can be part and parcel of a business that’s still establishing itself, so by hiring freelancers, you can go some way in limiting the risks involved in bringing in-house staff into your organisation.
Strong vetting processes
There’s no shortage of places where businesses can find their ideal freelancers, and platforms like Freelancer.com
are great solutions that offer strong vetting processes to ensure that you only recruit the right worker for the task at hand.
While the process of finding a freelancer was formerly arduous, digital platforms have made it a fairly speedy and streamlined job. This will be particularly good news to entrepreneurs who will undoubtedly have lots on their plate as their company establishes itself in a new market.
Many platforms not only have a strong vetting process for applicants, but also run a review-based system for workers, so potential employers will be able to see an Uber-style star rating for each potential freelancer they recruit - helping to limit the possibility of a poor performer or bad fit for your business.
No chance of supervision
You may be capable of getting in contact with your freelancer, but there’s little chance of you supervising them in a similar way to that of an employee. This means that you’ll never really know the time they invest in your work, or how well they’re sticking to your brief, or there are certain aspects of their task that they don’t understand.
Furthermore, freelancers can’t be trained by in-house staff, meaning they may be unable to comply with your own house styles or standardised practices.
Fundamentally, there’s always the danger that you’re getting billed for a freelance worker to spend 30% of their hourly rate sat on YouTube. As an entrepreneur who needs to give your company the best chance of survival as possible, this lack of clarity could prove costly.
Quality won’t be assured
Despite there being strong vetting processes in place, the quality of the work you receive from your freelancer won’t be assured.
There could be a range of unforeseen limitations in the work your freelancer produces
, or worse, it could’ve missed some significant parts of the brief that was sent.
Because there’s little chance of supervision, there’s a higher risk that you’ll receive work that isn’t right for your business. This could cost more time and money in correcting underlying errors in-house.
Lack of loyalty
Naturally, freelancers will have less interest in your business. They’ll likely be working for a number of companies at the same time and their primary focus will be on making ends meet.
While it’s perfectly reasonable for a worker to put their own needs first, freelancers will have less vested interest in the performance of your business and less reason to stick around than in-house workers.
Virtually every freelancer you use will be juggling multiple jobs at the same time, so their loyalty to one specific brand will generally be lower than that of a full-time member of staff. For many businesses, this may not matter, but it could be important if, say, you’re looking to use a freelancer on a recurring basis to convey a consistent tone of voice within your on-site content, for example.
The gig economy is expanding at a rapid rate, and as technology continues to evolve, the market will carry on its rate of growth.
There are plenty of positives to take on board when utilising the help of a freelancer, but some negatives could prove to be a sticking point for certain small businesses. Be sure to explore your options, allocated budgets and cash flow projections before deciding between freelancers or in-house staff. Technology has offered us an unprecedented level of choice when it comes to dealing with our operations, it’s up to you to decide whether you’re ready to delve into the gig economy or not.
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