A new year is upon us. As we look in the rearview mirror, the road has been a long and winding one. Navigating the many challenges associated with a global pandemic, the highest inflation in four decades, and recession fears growing stronger each day–conversations surrounding the labor market are still dominating headlines.
With the latest BLS jobs report showing signs of a labor market still in flux, 2023 brings a tougher outlook. Four million people are still quitting their jobs each month—quit rates aren’t showing signs of slowing, turnover is still sky-high, and absenteeism is a multi-billion dollar problem.
With that, Gartner says organizations will face historic challenges this year: a competitive talent landscape, an exhausted workforce, and pressure to control costs. However, overcoming these challenges will take bigger ideas and bolder moves. Queue the gig economy.
As the use of independent contractors becomes a more entrenched part of today’s workforce, companies that have dismissed alternative staffing methods in the past are now jumping in the gig game.
Emily Rose McRae who leads the Future of Work and Talent team at Gartner said, “The reality for this year is—whether or not we go into a recession—everyone’s a little nervous. In a lot of cases, organizations are not necessarily doing a hiring freeze or layoffs, but may be slowing down on their hiring. However—they still have financial goals to meet—often, ambitious ones. The talent shortage that we talked about throughout 2022 hasn’t gone away,” McRae says.
Quiet hiring, according to Gartner, will dominate the U.S. in 2023. With companies taking a more conservative approach to hiring right now—they’re still looking for ways to get the help they need without fully loaded overhead expenses. Gartner says that quiet hiring will be a new way for companies to quickly snag in-demand talent such as gig workers.
This year, cost reduction initiatives and the need for companies to increase productivity will converge with workers looking for more flexibility.
According to the latest freelance survey by McKinsey & Company, the gig population, now 60 million strong, “has no employer-provided health care or 401(k)s to build retirement savings, and they have to pay twice as much into Social Security as their peers. These individuals don’t get paid time off and must cover their own business expenses, and their earnings can be subject to unpredictable swings. But here’s the kicker: they are the most optimistic workers in the country.”
You may need to re-read that last sentence. I did. Twice.
The survey cited that the most optimistic independent workers are those who do the work because they enjoy it or because of the flexibility it offers. Tapping into this growing pool of motivated workers enables companies to get the help they need, while keeping costs in check.
According to Statista, gig work will generate $455 billion in 2023, up 53% from 2020. With businesses posting 26% more openings for contract workers between May and November of 2022 versus the same period in 2021, the shift towards gig will continue to gain popularity as companies look for additional ways to save.
From pressure for wage increases amid inflation to the hidden costs of hiring, more companies are leveraging gig workers—not just as a band-aide—but as a long-term workforce strategy. Tapping into the gig economy and on-demand labor apps like Hyer enables businesses to respond to fluctuations in demand in a manner that is fast, easy, and cost-effective. A trend that is now becoming the new norm.
Thinking about transitioning to gig? Talk to our team today!