Tough gig. Will new ways of working actually work?


Got up early for another great PWC New Zealand Herald Talk. Today’s topic was The Gig Economy: Future of the workforce. It’s a big topic.

What will it mean for work? What will it mean for workers? And what could it mean for society in general?

These were the questions knocked around by a brilliant panel including evangelists, pragmatists an academic and the Minister of Education.

It doesn’t feel like we landed many answers.

First, what’s a Gig Economy?

The gig economy can be defined as a “shift toward replacing full-time employees with independent, short-term contractors.” Or a “move from a succession of different jobs to a portfolio of different ‘gigs’ or opportunities.” This shift is accelerated by disruptions through technology. Think Uber drivers, WeDo fixers and homeowners turned hoteliers through AirBnB. Anyone who does lots of different jobs, rather than one.

Why is it awesome?

For many, the attraction of the gig economy is flexibility. It affords people the opportunity to build work around life rather than the other way around. For others it’s the passion or extra income of a ‘side hustle’. The idea that something I do on the side might one day be my real job or earn me some extra cash.

From an employer perspective, it’s also attractive. Technology can connect multiple contractors to various different needs and basic economics helps drive down the price.  

Why is it challenging?

Workers in a gig economy are usually self-employed. They manage their own time, contracts and cashflow. They also usually look after their own equipment, tax, sick leave and super payments. Since few in a gig economy are ‘employed’ there also aren’t any protections under employment law. It’s interesting that one of the investment risks outlined by Uber before their recent IPO was “our business would be adversely affected if Drivers were classified as employees instead of independent contractors.” But not to worry, their values boldly proclaim that they “Do the right thing”.

The gig economy just isn’t economic.

I totally get the benefits of flexible working. And I absolutely buy the notion of working for something you believe in. But my big challenge to the gig economy is the economics. There was much laughter in the room when someone reminded us of research that ‘people are only productive for three hours a day’. I’m all bought-into that one too. But I’m lucky enough to get paid eight hours for my productive three. If I was only paid for the time I actually worked, I’d be in some serious trouble.  

Social co-working is far from social.

The other nirvana of flexible working is flexible working environments. They’re out there, they kind of work for some people. But having great flatmates isn’t like having family. Most businesses thrive because of the interaction of co-located, like-minded people clustered around culture. Sure you can share jokes over Slack – but can you create those human moments of comfort and camaraderie that build real trust?

Gigs are a fad. But the future is real.

For me, both the language and evangelism of a ‘Gig Economy’ makes for a fun conversation. Old-fart business owners like me start ranting and millennials roll their eyes because I just don’t get it. But the big challenge of the ‘Gig Economy’ and its best mate the ‘Sharing Economy’ is that the real disruption is economic. Whether it’s jobs, rides or random crap from Amazon, technology connects buyers and sellers far more efficiently than any ‘old-school’ business ever could – and that kills local businesses to boost the personal profit of a limited few – usually overseas.

So I call “meh” on Gig Economy hype and “more” on conversations about the future of work. In particular, the importance of continuing education. The second-best quote of the day came from Chris Hipkins. Asked what advice he would give kids who are wondering what to learn, he said “Attitude.” “Keep learning, be a team player and if you see yourself as successful, you will be.”

And that’s the thing. For all the talk of millennials and technologies and a rolling succession of new “economies” – the world will always keep changing. And the best thing we can do to keep up is stay excited. That and the best quote of the day. Again from the Minister but borrowed from Alvin Toffler. “The illiterate of the 21st century will not be those who cannot read or write, but those who cannot learn, unlearn, and relearn.”

I reckon he’s probably right, what do you think?

Michael Goldthorpe