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How SMBs
can navigate
the gig economy
challenges and
maximize the benefits

Author: Satta Sarmah Hightower

The gig economy typically involves employers using digital platforms to connect with freelance workers for one-time job opportunities or project-based work.

The gig economy is booming, with the number of full-time freelancers now making up 35% of workers and contributing $1.3 trillion to the U.S. economy in 2021. Separate research also shows that 16% of Americans have earned money from an online gig platform.

With increased competitions for workers, it makes intuitive sense that small and medium businesses (SMBs) could benefit from freelancers. However, given that the very notion of the gig economy challenges established ways of working, some SMBs may be unsure about what is needed to make the most of this opportunity. So, what are the gig economy pros and cons for SMBs, and what role can technology play?

If you've ever used a rideshare or grocery delivery service or hired a web designer via an online marketplace, then you've had experience with the gig economy. The driver who takes you to the airport, the shopper who fulfills your order at the local grocery store and the skilled professional who designed your website are all gig workers and were paid one time for that specific gig.

Gig economy benefits for SMBs

A recent Journal of Financial Economics paper found that the introduction of gig opportunities prompted a 5% increase in new small business registrations and similar levels of business lending.

Companies also benefit from the gig economy in terms of cost savings. By using gig workers, businesses can reduce their benefits and salary costs significantly. According to the Bureau of Labor Statistics, benefits make up 31% of employee compensation. With gig workers, companies give themselves more financial flexibility and potentially more savings to reinvest back into their business.

One of the most important factors when it comes to gig economy pros and cons is how it creates more opportunities for both workers and companies. Gig workers value the flexibility, self-direction and opportunity to earn extra income. On the other hand, organizations, particularly SMBs, value the ability to access a range of specialized workers without needing to justify a business case to permanently hire them. Whether it's a one-off task like redesigning your logo, or something ongoing like managing financial accounts, you can benefit from someone's specific skill set.

The extra flexibility also allows for resources to easily scale up or down based on changes in customer demand, budgetary needs and evolving strategic priorities.

Gig economy challenges for SMBs

The International Federation of Accountants identified several possible drawbacks to SMBs in their analysis of gig economy pros and cons. While initially about accounting practices, their lessons have relevance to all SMBs. Some of the challenges identified were:

  • Difficulty building firm culture and developing long-term relationships
  • Limited knowledge transfer and development of internal capacity
  • Challenges to training, communication and quality management
  • Cyber security risks from gig workers using their own devices

SMBs with distributed staff will undoubtedly recognize the similarities between remote/hybrid work and gig economy challenges. For cyber security, SMBs can follow the BYOD security playbook for remote employees, which prioritizes education, intelligent monitoring and creating a mobile safety net.

The other three challenges highlight the value of investing in solutions that support both synchronous and asynchronous communication and collaboration. Synchronous communications are scheduled, real-time interactions by phone, video, or in-person. Asynchronous communication happens on your own time and doesn't require scheduling.

All team members, regardless of their employment status and location, need to be able to work with each other at any and all times. Thankfully, many of the technological solutions that successfully power SMBs with remote staff also apply for gig workers.

Gig economy communications and collaboration solutions

Whether your team members are in-office, remote, gig workers or a hybrid of those, Verizon can deliver the business communication and collaboration solutions you need to create and empower an effective working environment, including:

  • A unified communications and collaboration platform, also known as Unified Communications as a Service (UCaaS), consolidates a company's entire communications infrastructure into a unified platform. It allows companies to bring together voice, video and messaging capabilities into a single solution to streamline internal communications and empower their team to better serve customers.
  • A mobile-first business phone system that supports today's flexible work environments, such as One Talk. Your business phone numbers can be shared across supported office phones, mobile phones tablets and computers including personal devices of gig employees in order to minimize missed calls. Calls to your business numbers will ring on your compatible smartphone, One Talk desk phone, tablet or computer, so customers can reach you even when you’re on the go, with clear, natural, HD-quality sound. Outgoing calls display your main business number no matter which compatible device you’re using, so customers know it’s your business calling. This is especially crucial for gig workers who may be traveling to deliver a customer's order or a seasonal customer service agent who may be taking customer calls from a branch office or from home.
  • Other relevant tools can include virtual whiteboards, project collaboration software, online interactive training and file-sharing solutions. The tools they deploy are often multifaceted. For example, BlueJeans by Verizon enables gig workers to virtually meet and communicate with teammates, partners and customers while leveraging in-app intelligence to capture important discussion points and assign action items that make each meeting more efficient.

Just like remote working, each SMB will need to carefully evaluate the gig economy pros and cons to determine how much involvement makes sense for their organization. As they are making that assessment, they can rest assured that Verizon has the security, communication and collaboration tools needed to minimize any gig economy challenges and maximize the benefits.

Learn more about how Verizon can make any kind of work, work.

The author of this content is a paid contributor for Verizon.