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The Gig Economy Article | HR Benefits and Challenges

   

Added on  2020-04-07

14 Pages3493 Words74 Views
Leadership Management
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1Running head: The Gig EconomyThe Gig Economy: HR Benefits and ChallengesStudent Institution
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2The Gig EconomyTable of ContentsIntroduction ................................................................................................... 3How the Gig Economy Operates ........................................................................... 3Benefits of Gig Economy ................................................................................... 5Challenges of the Gig Economy ........................................................................... 6HR Implications .............................................................................................. 8Recommendations for Uber to Make Best Use of Gig Economy .................................... 10Conclusion ...................................................................................................11References ................................................................................................... 12
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3The Gig EconomyIntroductionThe gig economy is that workforce that is based on single or on demand tasks often donethrough the digital market place or what is called alternative arrangement (Bureau of LaborStatistics, 2005).There is an emergence of new business models given rise by digital platformswhich include classic examples like eBay and Amazon and new ones that include Uber andAirbnb among others (Burtch, Carnahan & Greenwood, 2016). Businesses of this kind, alsoknown as the gig-economy are expected to make up a big part of the economy and withimplications like disrupting the long standing business (Morse 2015) and the replacement of theexisting businesses (Zervas, Proserpio and Byers 2015).The gig economy has provided anopportunity for flexible employment with the workers setting their own working schedules whilethey still earn a relatively stable pay (Hall & Krueger, 2015). The gig economy may alsoeliminate some jobs while also benefiting individuals who have a weak attachment to the labormarket (Zervas, et al., 2015). Notable also is that the gig economy employees are at the mercy ofthe startups often overworking themselves and lacking in the benefits and the legal protection ofthe permanent employees (Brown, 2017). There is an opportunity for policy makers to considerthe legality and regulate this gig economy (Zervas, et al., 2015). This paper will discuss how thegig economy operates and the HR implication of this emerging economy and the benefits andchallenges for organisations.How the Gig Economy OperatesThe rise of part time employment or independent contractors began to rise in the 1980s inAmerica linked to various factors like worker preferences, the state of economy, labor lawchanges, a decline in labor unions and high levels of unemployment among other factors. The
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4The Gig Economypatterns of employment have dramatically changed from traditional employment giving rise tothe gig economy where workers work under alternative work arrangements (Friedman, 2014).The gig workers have been classified as being self employed, independent contractors,freelancers or independent consultants (Katz & Krueger, 2016).The gig economy takes the form of crowd work or on demand work which is foundthrough apps. Crowd work involves completing work activities through online platforms(Kessler, 2015). This matches the available job opportunities and skills. These platforms allowmany organisations and individuals to connect through the internet and so employers andemployees connect globally. Work on demand apps allow the demand of the work and its supplyis channeled through mobile apps where the firms that manage the apps may also intervene to setminimum expected standards of service and even selection of the employees. This may involvesome of the traditional jobs like transport, cleaning or even some clerical work (Rogers, 2015).Most of the gig labor is found in labor intensive traditional work like construction andagriculture while some are in highly educated IT field. On average, most gig workers are seen tobe paid less than their equally educated young people in traditional employments. Companiesmake use of gig workers to lower labor costs especially as it relates to benefits (Friedman, 2014).Either way, they provide a good opportunity for job opportunities and flexibility both for theorganisation and for the workers. It is difficult to state the number of people working in the gig economy since mostcompanies do not disclose the number. Another reason is that the gig workers may work for anumber of organisations during the same period, whether weekly or monthly or even daily
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