How the so-called ‘gig economy’ could help Britain’s employers plug skills gaps

The Recruitment & Employment Confederation (REC) recently issued a report entitled “Gig economy – the Uberisation of work” and surmises that, in order for organisations and people to prosper, clarification of the legal status of employees in this new element of the economy is critical.

So what is the gig economy? It is businesses including Uber, People Per Hour and Upwork who partner freelancers with those seeking help with various project-based tasks.

Following its report, the REC has called upon the Government to make sure that the gig economy treats gig workers and businesses fairly and to ensure that there are benefits to be gained from them for the UK economy as a whole. An incredible 766,000 people stand to benefit from finding work through these types of business and predictions are that the UK economy is set to be boosted by some £45 billion through their endeavours.

Kevin Green, REC Chief Executive, described how gig working is becoming commonplace, which is great news for employers who will be able to benefit from access to a broader talent pool.

He continued by saying that the UK is approaching full employment and companies across the spectrum have to respond to shortages in key skills.

Green says that businesses need to exploit newer technologies to address the issues associated with the current labour market. However, he believes that protection of gig economy workers is critical in ensuring that the recruitment industry is able to compete on a level playing field.

The REC’s report follows in the wake of Uber’s recent appearance at an employment tribunal over the employment status of its drivers. Uber drivers insisted that they were employees of Uber as opposed to small business owners running independent operations.

A number of recommendations came out of the REC report, including the following: 

• Make sure that gig economy workers and businesses can take appropriate recourse in situations in which poor practices are identified
• Clarification of the legal and tax status of those employed in the gig economy
• Ensuring gig workers are afforded identical protection rights to those enjoyed by self-employed individuals
• The Low Pay Commission should be allowed to decide what is a fair level of payment for workers in the gig economy
• Ensuring that the same rules which govern the recruitment industry are applied to digital work platforms in order that the differing models can be in competition with one another on a level playing field.

Bill Richards, MD of jobs website Indeed believes that approaches to employment norms are being modified as a result of the growth of the gig economy. A mere 13% of British people anticipate that their employment will feature traditional 9 to 5 engagements by 2025. This is due to the increasing number of opportunities for temporary and flexible positions brought about by the burgeoning gig platforms.

Chris Bryce, chief executive of the Association of Independent Professionals and the Self Employed (IPSE), described how job seekers are altering their habits and is positive about the fact that this is being noticed by the Government.

Bryce commented that while up to a third of employers are likely to promote projects on digital platforms by 2021, job seekers on these sites remain caught between employed and self-employed statuses. He added his voice to those calling for the Government to intervene with the issue of tax and legal status.

The REC research included data collected in a YouGov survey of 614 business decision-makers.