The way we work is changing at an incredible speed.
The future of work is a hot topic of discussion and debate both in New Zealand and globally with much of this discussion centred on the shift from traditional job vacancies to the rising gig economy.
Advances in technology are one of the driving forces behind the development of new ways of working. One example of this is mechanical automation, which over the past few decades has resulted in automation of many low skilled jobs. Current advances in software technologies, such as scripting, Artificial Intelligence (AI), machine learning & robotics are leading to more automation and more low skilled roles becoming redundant. The number of high skilled jobs being replaced by software and hardware is also increasing. Consequently, this disruption is creating a plethora of new jobs associated to AI, machine learning & data analytics. Change is constant; disruption is affecting every industry as we know it, but also producing opportunities as a result too.
Such advancements in ‘what’ we are doing, combined with the changes in ‘how’ we do them (flexible working, gig economy, etc.) is beginning to have a big impact on the recruitment world.
The discrete distinction between ‘jobs’ and ‘gigs’ is blurring. We have begun to see a new wave of digital work platforms, catering for both the gig economy and traditional job vacancies. Gigexchange, a new start-up in New Zealand, is leading the way on this front.
How will the recruitment industry respond to the disruption? How can those who have a traditional focus on jobs cater for the emergence and rapid surge of the gig economy? Those that embrace and adapt will ride the wave of success; investigating new business models and leading the change will result in new markets for many recruitment agencies and consulting companies.
Adapting the revenue model is another important aspect of recruitment across the differing markets. For example, in the current contracting world, ‘clipping the ticket’ for any time based contract is standard practise. This is where the recruitment agent reserves a percentage of the contractor’s earnings as payment, for the duration of the contract. This does not work with the gig economy. The gig economy provides an important shift in focus – from a ‘time based’ model to an ‘outcome based’ model.
Gig economy platforms provide financial security and peace of mind to their clients because payment is made on satisfactory completion of the agreed work assignment, the time aspect is irrelevant to both the client and the worker; they are both focussed on achieving a common goal. Gig economy platforms also promote work excellence and reduce fraud by way of a reputation rating, similar to those used by Airbnb, eBay, Trade Me, etc.
With all this in mind, can the gig economy work for traditional recruiters?
It all comes down to identifying what the added value of a recruitment agency is over a gig economy service and platform or how they can add value using the platform on behalf of their clients.
The value of administration, interviewing, filtering, due diligence checks, managing the advertisements on the digital platform, contractual agreements and aiding with the on boarding are the same for both recruitment agencies and the gig economy service.
The only difference is in how – and how much – recruiters generate revenue.
The way we are working is changing, the way we recruit is changing. Outcome-based gig assignments bring an increased volume of work. Recruiters who offer a fair fee structure for gig workers will find themselves as the leading recruitment agencies endorsed by the gig workers of New Zealand and beyond.
Those recruiters who can see the opportunity and embrace the changing world have an opportunity to become leaders in the future of work through recruitment.