On demand economy and adapting to change

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On demand economy and adapting to change

If you have ever ordered an Uber, requested a task on AirTasker, or ordered a meal through Foodora or Deliveroo, you have inadvertently contributed to the growth of the on-demand and freelance economy. With the power of mobile phones mixed with the unpredictable nature of the job market, the rise of the on-demand and freelance economy has provided individuals with a wide array of jobs whilst posing a significant threat to ‘traditionally secure’ industries.

One interesting driver of this trend towards a ‘gig economy’ is Millennials. (Oh boy, here is another thing that they are being blamed for.) For Millennials, the convenience and practicality of these contract and freelance services which are able to save fifteen to thirty minutes at a time or the stress of doing it themselves, is appealing. However, which side of the equation are Millennials more likely to be found?

Whilst Millennials are certainly the face and target market of this economy, the Millennials (and group of people) that are more likely to be found on the supply side are those that are experiencing low job security or just want a little side-job. The premise of hustling a little more than what everyone else is willing in order to earn ‘cash in hand’ is an effective way of giving the individual more control of their schedule. With more and more people thinking of their jobs as fleeting, short term, and dispensable (i.e. not in it for the long term), it can only be said that these platforms are addressing existing in inefficiencies and vast disruption caused by technology and innovative businesses.

Something that may become more relevant in the near future is the effect that casualisation will have on: politics (regulation), ethics, the economy, and society.

  • Politics (regulation):Parties maybe in favour of job security, another don’t really know what they want, but whether or not regulation is drafted and enacted on a state or nation-wide basis is really to be determined by the market. Although standards should be sought in terms of the verification of users and providers, in order for the gig economy to maintain its competitive edge over traditional businesses regulation needs to be sparingly implemented. The idea that every part of this new industry has to be regulated is highly related to opinions in the other spheres.
  • Ethics: Should people employed or using services such as Airtasker and Uber, be concerned about the welfare and wages of their ‘hosts’ or contractors. Yes and no. Yes because it is unethical to support a business that encourages people to bid for and underprice their services in order to get business, on the other hand, the world has tended to ignore the intangible quality of ethics as a result of capitalism and globalisation. We already have sweatshops in developing nations who produce clothes and appliances for extremely low wages, and yet Australians continue to purchase them; whether or not this is ethical or hypocritical of people is purely matter of personal beliefs.
  • The economy: Nothing about economics is certain, and the concept of demand and supply for a job is highly dependent on fluctuations in the market. Hence, is it better to completely ignore the gig economy, or encourage people to find (temporary) employment even if it is through a freelance or contractor service platform? How will legacy businesses and industries such as hospitality, transportation, retail, and construction/trades respond to a marketplace which is more effectively finding what individuals are looking for? Could this bring about another Kodak?
  • Society: With more people buying and supplying services, whose interest should businesses take into consideration? Whilst it is self-explanatory that businesses need to have a consumer base who is willing to pay, and a workforce who is willing to work, the market will inevitably show that buying power is much more valuable. With the mindset of a ‘9 to 5’ job going out of fashion faster than man-buns, it is almost certain that individuals will no longer be a part of a secure workforce that is controlled by a handful of key businesses.

So what can and should businesses and Millennials do to make sure they stay ahead of the curve? Either adapt to the new economy, or work harder in the existing system. In order to keep yourself relevant to your (desired) job, you need to continue learning and gaining experience, and is that means getting up at 5am and leaving the office at 8pm, so be it. Despite some participants of the gig-economy expressing their newfound freedom and productivity as a result of working their own schedule, the price paid for this status is being constantly ‘on-call’ for businesses. However, I do not think that full-time jobs will ever be gone, and at the same time I do not think that the one-off nature of the gig-economy will ever be enough to comfortably support most people. As such the way businesses can succeed is by innovating to keep the know-how and skills internal to the business (as soon as it can be separated it can be freelanced), and this means recruiting the right talent and giving them an incentive to stay on-board.

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