Our Jobs Are Only Going to Change, Not Disappear.
How AI and Remote Work are shaping the future of work
How AI and Remote Work are shaping the future of work
Our jobs are only going to change, not disappear.
The way we work is changing every day, and this is likely going to be the biggest revolution that mankind has seen in centuries. Why? Because, work is something that defines us. Any change in that is going to have a huge impact on us.
Have you ever been to Vietnam, Thailand, or Indonesia? If you have, you’ll find a bunch of young folks working out of cafes. They’re called ‘Digital Nomads’ — skilled workers with location-independent work that frees them to travel the world.
I founded Indiez, a community-powered remote working platform after a trip to Vietnam. When I spoke to digital nomads, I loved their story, and it inspired me to build a platform that enabled people to work on awesome projects from anywhere.
Multiple companies like Indiez have been founded in recent years. It’s easy to see that the rise of ‘Gig Economy’, facilitated by technology, is the biggest driver of the upcoming change in the employment scenario.
It’s true though that the gig economy is nothing new. It existed hundrends of years ago, when lancers were picked up by armies for daily work. They weren’t sworn to any king, and were ‘free’. Hence, the term ‘free-lancer’.
But today, thanks to technology, the same concept has been extended to almost every type of job.
A gig economy is an environment in which temporary positions are common and organizations contract with independent workers for short-term engagements.
An estimated 9.2 million Americans will work in the gig economy by 2021, up from 3.8 million in 2016, according to combined research from Intuit and Emergent Research. A more than 200 percent increase presents a significant opportunity for marketplaces, both in the US and beyond.
While at the same time. there are mixed speculations about the ‘gig economy’.
Some, including me, say it’s the future of work.
They love the concept and can’t wait until the gig economy frees everyone from working as employees for large, bureaucratic organizations. Still, others worry that this is the latest form of labor exploitation that will surely consume all of us, driving us into the pits of poverty.
Just like any change that occurs in the economy, there are people who will win and lose as this concept expands.
An article by HBR pointed out that workers with specialized skills, deep expertise, or in-demand experience will win in the gig economy. They can command attractive compensation, garner challenging and interesting work, and secure the ability to structure their own working lives.
The people who will struggle most are corporate workers whose skills are common, commoditized, or in less demand.
While that offers some perspective, in this article, let’s explore further the various forces shaping the gig economy. Is it really the future of work as it’s hyped up to be? And more importantly, what does it mean for people like you and me?
The Gig Economy isn’t just for startups anymore
Increasingly, Fortune 500 companies and global giants like Samsung are turning to online freelancing platforms like Upwork and PeoplePerHour to find designers, marketing staff, IT specialists, and other knowledge workers. Currently, Upwork, for instance, works with 20 percent of Fortune 500 firms.
On a broader level, what this points out to is the shift in overall values.
Traditionally, hiring and retaining talent has been one of the core focus areas for big corporations. There’s also intellectual property to protect and culture to maintain.
But with the shift in values, the larger firms have begun to appreciate more “permeable borders” and to see freelance workers as a source of fresh ideas and “knowledge transfer” from the wider world. Companies like Pilot.co, Toptal and Marketworker are certainly facilitating this.
Future Workforce Report 2017 by Upwork
The bigger reason however for corporations to participate in the gig economy is that it is so much more efficient in terms of cost and time involved. Corporations like Samsung, having embraced the freelancing model, observed 60% cost savings, and reduction in administrative time by 64%. They’ve seen why this is destined to become the future of work.
Millennials form a huge percentage of gig economy
By the year 2020, millennials will make up 75 percent of the US workforce. The Millennial Economy Report states that almost half (44 percent) of the millennials surveyed have a side hustle. This report highlights the fact that Millennials are looking for careers that give them freedom, flexibility, and fulfillment.
Whether the primary motivation is to choose their own hours and work from home, travel the world while earning a living, become their own boss or otherwise, countless millennials are opting to ditch traditional full-time employment and cash in on the gig economy.
The independent knowledge workers
Independent professionals tend to be experts in their field. Typically breaking from the traditional work structure after they have mastered their craft, independent professionals have no employer or employees — they work directly with clients for profit.
The economy is now powered by millions of micro-entrepreneurs who own their businesses, rather than a small number of giant corporations. Virtual jobs for knowledge workers are fast becoming the new normal for the Gig economy.
They are accountable for their work and hold multiple job roles. For instance, it’s now possible for someone to be working for McKinsey as well as BSG — something that wasn’t possible before.
The rise of Artificial Intelligence
It has been speculated that the workforce landscape will change in the next decade from robotics and artificial intelligence as well, which will perform any dull, dirty, or dangerous jobs.
What that means for the gig economy is that a large section of mundane tasks will cease to exist.
We can expect AI to replace financial planners, administrators and accountants, just to name a few. This threat to current jobs means only one thing: In ten years everybody will be forced to be an ‘entrepreneur’.
While that may or may not be a good thing, it clearly points to an increase in the number of people forming a part of gig economy.
Although it’s conceivable that humanity will automate itself into unemployment in the near future, gig workers capable of retooling and pivoting can expect to find more and more work. There will be newer requirements taking shape and an ability to mold according to them will determine success in the world where AI and the rise of the gig economy are two major drivers.
There will also be a need for AI-enabled smart tools to match relevant workers to the organizations who need them. More and more companies will work in this domain.
‘You get what you pay for’
Even in the gig economy, how you treat the people you work with determines everything. Companies like HomeJoy (home cleaning), SnapGoods (gear rental), and SpoonRocket (home delivery of fast food) have gone out of business because apparently their CEOs never learned the old business secret that “you get what you pay for.”
The quality of the human worker is crucial for success, which ultimately depends on how well the workers are treated and rewarded. If companies show their workforce no allegiance or loyalty, then they won’t get any in return.
Fortunately, we are seeing some potential solutions.
One is a stock photography website launched in 2013 called Stocksy United, which, besides providing stunning images, also is a worker-owned cooperative. Unlike many billion-dollar “unicorn” startups that pay their workers peanuts, the Stocksy member-photographers keep most of the money from sales of their work. The company’s revenue doubled in 2015 to $7.9 million, with more than half paid out in royalties.
Etsy, an online sales platform that connects professional craftspeople to customers, is another company that appears to be offering a fair deal, with Etsy taking a reasonable fee of 3.5 percent for each sale. Uber, by contrast, takes 25–30 percent of each fare. Juno, founded by Talmon Marco, is competing against Uber by treating its drivers better, including offering higher wages and stock options.
Concerns about job security
The ‘gig economy’ essentially means “Uber-ization” of the workforce in the coming decades. Any service that can be outsourced will be, and will be done so on a demand basis.
Everything will be priced by the deliverables, making almost everyone an ad-hoc service provider. It’s easy to see that the job security of yesteryear is forever gone. There will be no assurance of employment until retirement.
The gig economy treats a worker’s labor like just another cog in the business. Workers are paid only for the exact minutes they are producing a report, or designing a logo, or cleaning someone’s house. It’s as if a star quarterback got paid only when throwing a touchdown pass, or a chef was paid by the meal. There’s no annual or monthly salary.
It takes us back to the days of the piecemeal wage economy, which was more prevalent in previous centuries. That doesn’t sound that bright? Does it?
However, the government is working on some great solutions. One possibility is the ‘portable safety net’ wherein every business would contribute a “benefits fee” for each of its workers, pro-rated to the number of hours worked for that business. The worker would be able to port her or his “individual security account” from job to job.
While that seems like a fine possibility, that could also be easily integrated with blockchain tech — it just hasn’t been fully explored yet. As of today, there is almost negligent safety for the gig workers in this regard.
Conclusion
As quoted by John Hagel in one of his detailed articles about the gig economy:
We’re just in the earliest stages of an emerging and evolving gig economy.
Over time, it is likely to evolve from a focus on routine tasks (as they get replaced by robots) to a better focus on creative work. This in turn will lead to a shift from work that is defined by short-term transactions to work that is pursued in the context of rich, trust-based and sustained relationships.
In short, the gig economy may become a fertile seedbed to help all of us achieve more of our potential and deliver expanding value to the marketplace.
Well said, Mr. Hagel. Well said.