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Jobshop UK advises clients on pros and cons of gig economy

Bournemouth-based Jobshop UK has been advising clients about the pros and cons of employing new recruits via a growing trend of collaborative digital work platforms, known as the ‘gig economy.’


The gig economy allows companies and consumers to source freelancers and self-employed individuals for projects and services on an as and when required basis. Within the UK 6% of employers are already using this method to recruit, with 29% stating they think this method will be important to their business within the next five years. According to the REC’s ‘Gig Economy Report,’ in conjunction with Indeed, almost a third of UK employers will be utilising talent from the gig economy by 2021.


Director at Jobshop UK, Frances Miles, explained, “The gig economy has a number of benefits to the employer, such as speeding up the recruitment process, offering access to a global candidate base, and reducing the cost of permanent hire. The employee benefits from increased flexibility, being able to set their own set their own price/fee, and again, being opened up to a global marketplace.  However, there are potential disadvantages as well and it’s important to weigh these up.


“Limited screening regarding ID, qualifications and eligibility to work, could lead to problems for the employer, as could a lack of compliance and protection, including confidentiality and industry standards.  There is no guarantee to the quality of work produced, and a potential lack of loyalty could again prove troublesome for the employer. 


“An employee on the other hand risks feeling devalued of their own worth through the inevitable highly competitive pricing matrices.  There would be no worker’s rights, security, pension contributions, or any guarantee of continuous work, making job security almost non-existent. Many workers could understandably end up lacking a sense of belonging, which as most employers will know, is a vital attribute to loyalty and productivity within a business.”


There are also concerns regarding the gig economy putting further strain on the UK pensions system.  The UK government has put into place legislation via the auto-enrolment system for pensions, whereby employers have to sign up to a pension scheme for their employees with both contributing to this. However, research has shown that within the gig economy, freelancers do not save for their future due to the potential lack of continuous work. With no official regulations in place, an increase in employees not having the financial confidence to contribute towards their own pensions will put an already stretched benefits systems under further pressure.


Miles, concluded, “Nothing will ever replace the human touch when dealing with people, and a good recruiter spends time understanding the needs of both the employer and employee to enable a deep understanding from each side’s real needs and motivations, as well as often being the mediator between both parties; managing expectations, individual concerns and ensuring a good outcome for everyone. The gig economy is here to stay whether we like it or not, but the danger lies in the freedom of companies to treat workers as an extension of sophisticated tech rather than as people.”

Picture: Jobshop UK directors, Tracey Wood and Frances Miles

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