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Betting on gig economy amid rising attrition rate

01 Oct , 2022   By : Monika Singh


Betting on gig economy amid rising attrition rate

In the last few months, India Inc has witnessed one of the biggest waves of attrition across sectors. In 2021 alone the attrition rate climbed up to 28.1% and even with a better part of 2022 gone, shows no signs of slowing down. Individuals are not just quitting but are also taking a hard look at what they want to gain from their workplace. For some, the incentive can be higher pay, more flexibility, better work-life balance, and more fulfilling opportunities. Employees now demand a better growth & lifestyle for the work they put in.



In such a scenario, there is a unique opportunity for both workers and businesses in the form of gig economy. The gig economy essentially works on the principle of contractual, part-time, or project-based work where the gig resources work on a flexible basis in exchange for monetary compensation. This includes talent across low, mid and high-skill levels, with roles such as delivery partners, tele calling executives and expert consultants, respectively.



Enterprises across sectors have been not only struggling to manage their expenditures set for hiring, training, upskilling and retention, but they are unable to ensure sensible returns on the investment. This is not a new challenge, nor is attrition. However, the gig economy presents itself as a solution to overcome the issue of attrition and uncertain productivity on cost incurred. While the gig economy has existed in India for years now, its recognition has been fairly limited to blue-collar work. Fortunately, the gig economy has witnessed accelerated growth in the last 2 years with grey-collar and white-collar gig work gaining prominence as well.



In this new era, legacy companies across sectors such as IT, FMCG, BFSI, Ecommerce, etc have joined startups across varied growth stages in adoption of the enterprise-focused gig work model. Whether we talk about software development, marketing and social media, data analytics or UX/UI design, enterprises are increasingly leveraging the gig economy to get their work fulfilled.

Now, with these soaring attrition rates, enterprises from all sectors are further turning to the gig economy as a respite. Even India’s IT cos are expanding their talent pool by working with independent contractors and other project-based workers without geographical barriers for their everyday activities. Not just limited to IT & software development, industries such as Assessment Industry, Media and entertainment, AI/ML Data Operations, Automotive, Electrical, Construction, FMCD, and among others, have the highest percentage of gig partners and rely on contractual workers.



The Future Of Work

This shift in perception and adoption of the gig economy is an integral move towards defining the Future of Work. Work fulfilment through platform-driven gig workers enables companies to pay only for outcomes, which in turn ensures productivity for the enterprise.

Moreover, talent today is increasingly shifting to the gig economy as well for the many advantages in presents. Greater flexibility, freedom over work hours, location along with the potential to enhance earnings have been drawing more people towards contractual work. Digitisation of professions and workforce further reinforced the concept of work from anywhere and is currently one of the main drivers of the gig economy.



Offsetting The Investment Involved

For many large enterprises the margins have remained flat in the last decade or so. However, their investment towards, upskilling, training of employees along with the fixed remuneration have exponentially increased. Now more than ever, amidst the growing attrition rate, a solution to these costs is required. By deploying the on-demand gig model, these enterprises can variablise their fixed costs and optimise PnLs by offloading the entire discovery, deployment, and fulfilment functions. Moreover, this also helps them remove additional costs incurred on upskilling and training.



Availability of Resources On-Demand

Another issue that organisations are facing is the difficulty to find skilled professionals, on time and within
desired budgets. This is especially relevant when enterprises are rapidly expanding capabilities and
diversifying skill sets within their workforce. With the gig economy coming into play, companies can now
work with gig partners across skill categories without the hassle of discovery, onboarding and management
of the workforce. With this ease of assembling a workforce and getting work started, gig partners have
become high impact workers with unmatched advantages for enterprises.

The contractual nature of employment helps the companies reduce hiring & training costs, varabilse P&L and execute work faster with better quality. While enterprises can independently hire hundreds of contractual workers, it can be a cumbersome process to manage the entire supply chain of onboarding human talent and getting the work executed with high productivity. This is where a technology-driven gig platform can empower the enterprises with specialised solutions and resources to manage and scale the gig model in their organizations.



Creating Agility for Enterprises

Post-Covid, enterprises have realigned their focus to maximise profit margins which has led them to look for a dynamic work environment that brings quick onboarding, understanding of projects and accelerated work fulfilment. With a gig workforce firms can create a robust workforce that can be enabled swiftly and easily. Gig platforms offer a plug-and-play proposition which becomes a cost and time-effective channel for enterprises. It reduces the go-to market time, and ensures agility for the organization while providing a diverse, geographically distributed skilled workforce best suited for the work. While the gig model can gigify and customize any type of business requirement, it is especially relevant for strategically critical and
high impact projects.

In conclusion one must remember that the gig economy is a ticket out of the attrition dilemma for many organisations. With time, many of these organisations have now come to understand the undeniable benefits of working with a gig workforce. Companies can now rely on a virtual talent pool across skill levels that is available for projects across locations to meet client demand and project needs. With geography no longer a barrier, companies can hire workers without fear of attrition and thereby create a robust talent pipeline and bring in diversity among the workforces.

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