Garth Rowland, Building Structures Practice Leader, Aurecon shares his take on what HR and corporate leaders need to be aware of after retrenching talent.
While the gig economy has been flourishing in other industries over recent years, the onset of COVID-19 has opened the floodgates. As big corporations, including law firms and professional service companies, have retrenched hundreds of staff due to dried-up work, an increasing number of start-up businesses were registered in the last few months. What will be the unintended consequences going forward? These highly skilled professionals are able to offer their services, typically to the exact same customers that they used to serve, at a cheaper rate due to lower overhead costs and a need to earn a crust quickly.
But what happens to the organisations that had to, unfortunately, let these people go? It seems unlikely to be an easy task. Garth Rowland, Building Structures Practice Leader, Aurecon argues that as big corporations and professional services companies retrench staff during this pandemic, they are unwittingly sowing the seeds of their own destruction by creating a job market of freelancers.
HR & c-suite do what they’ve been trained to do—cut costs
Many corporates and white-collar professional services organisations are unwittingly sowing the seeds of their own destruction right now by inadvertently creating a job market for freelancers. As a result, virtually every industry is teeming with freelance workers. The reduction in workload, caused by the pandemic, results in senior executives making the only recommendation they are trained to do—cutting costs to meet the reduced revenue pipeline. Coupled with existing freelancers and an increasingly smaller world, the ability of the gig economy to infiltrate traditional consulting worldwide is at an unprecedented high and the pandemic is forcing us all to become acquainted with it.
Can businesses learn to innovate around the gig economy as we grapple with skyrocketing levels of unemployment rather than create a new low-cost competitor? Could this be a chance to grow employee loyalty instead?
When they zig, you zag
Smart people, who run corporations, make seemingly sensible decisions and set up their own hyper-competitive environment. Once a means for success, now a dilemma, is there another way?
First of all, we need to recognise the problem and look for alternative ways to react and innovate instead of conforming to the invariable reaction anticipated by most companies. Instead of cutting labour costs to meet the reduced revenue pipeline caused by the pandemic, businesses can take a more proactive route—do not dwell on the loss, focus on finding opportunities. Deploy the mind and energy and intellect from these talented, perhaps underutilised staff, into new offerings, new services, or their own low-cost disruptive business options. Get them to do it internally within the business, rather than in opposition.
For example, after COVID-19, Zhejiang University (ZJU) closed their doors and switched to an online education programme while maintaining the university calendar. Within two weeks over 5,000 graduate and undergraduate courses were offered online garnering over half a million online visits. Many students will retain online learning into the future, also allowing ZJU to expand its offering. It is feasible that this additional demand will need additional educators and, in an online environment, there is no reason that this cannot be fed by freelancers.
Embracing freelancers
Since March 2020, Rowland, like many others, has been collaborating through technology with people who live literally as close as next door or half a world away. He explained, “Our ability to deliver projects has impressed me. So, it’s not too difficult to imagine how much the gig economy can potentially disrupt business more than it already has.”
However, can companies embrace and adopt this new economy without being eaten alive? Rowland certainly thinks so and said, “Forward-thinking companies are recognising the benefits of not only hiring gig workers but also encouraging their employees to freelance. Instead of investing in professional development training programmes, freelance projects could be identified to serve that purpose.”
He added, “Freelance gigs allow employees to develop new skills they might otherwise not have gained in their day jobs. Spending as little as half a day per week of available work time on a passion project could greatly keep workers engaged and happy, as well as keep the company on the forefront of the latest trends and technology.” These opportunities to freelance to support disadvantaged communities and charities also offer up a humanitarian option for those wishing to give something back.
Tightrope walk
Unpredictability caused by COVID-19 is turning the traditional procurement method on its head and forecasts that crowdsourcing will play a central role in reshaping the business landscape. Crowdsourcing will balance the power of influence between huge corporations and individual professionals, providing something structured rather than flexible.
It does not have to be one or the other—rather the integration of both freelance and permanent roles to get the best from both worlds. Perhaps embracing the gig economy will help HR, rather than merely ‘moving on’ from the pandemic to moving forward into the ‘new now’ in deciding who gets the gig.
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