Gig Economy Opportunities and Trends
By Robert Curtis, GigX, Inc Advisory Council Member
Table of contents
- What is the gig economy?
- A rapidly changing labor landscape
- The rise of fractional leaders
- Many are not ready for retirement
- Why do companies hire fractional executives in 2021?
What is the gig economy?
The gig economy is a term often used to describe longer-term freelance arrangements and independent consulting assignments. It started to ramp-up around 2007 during the global economic downturn and has rapidly grown. While sources vary in their estimates, a 2021 Fortunly article gathered data from multiple polling sources, which states that over one third of all workers have a gig work arrangement in some capacity.
Peter Miscovich, Managing Director, Strategy + Innovation, JLL Consulting in New York, indicated in a Serraview blog post that gig workers represent an even larger part of the workforce – and may reach as much as 80% of the workforce by 2030. The nature of work is changing, and corporate workplaces must be prepared to support that change.
A rapidly changing labor landscape
The rapidly expanding gig economy is not merely a response to changing economic conditions. We’re living in a time when companies are rewarded when they disrupt old ways of doing business to create new models that drive success. One of the biggest trends in this disruptive culture is the gig economy.
As an example, one of the biggest frustrations that startups and turnarounds face in 2021 is not being able to afford the leadership that would help them thrive. Paradoxically, employing great leaders can help a budding business grow to the point of finally being able to afford great leaders. Confusing, right?
Fortunately, the labor landscape is shifting. Over the last few years, the idea of working until retirement at the same company is gone. Employers can bring in talent on a “part-time, long-term basis”, allowing the company to more affordably capture the experience they are looking for while the employee finds a flexible work opportunity.
The rise of fractional leaders
While the gig economy has been growing rapidly, many executives are new to first-hand experiences. Companies have contracted with entry- to senior-level consultants for decades, but only in recent years have C-suite executives increasingly hired their peers or have been hired themselves for a gig. At these top levels, they are often referred to as fractional leaders or executives.
Why would an executive choose fractional work in 2021? Some late-career leaders are interested in using their significant experience within a start-up, mid-market organization, or a larger enterprise, but don’t want to work full-time or have to move from their chosen location. Being a fractional executive enables established leaders to have a significant impact on their clients' businesses while enjoying the flexibility and variety of managing their individual work opportunities.
The desire for flexibility shouldn’t be underestimated. An EY publication titled, How Boards Can Shape the Workforce of the Future, found the ability to work flexibly to be one of workers’ top priorities in a job for Millennials, Generation X and Boomers.
For sought-after executives, fractional work can also be highly compensated. Work with early-stage firms often includes a combination of a salary and equity.
Many are not ready for retirement
There’s another real possibility in today's workplace: instead of choosing when to leave a job, you may be downsized. While it is easy to be lulled into a sense of security that full-time, senior-level employment often provides, it makes sense to have a contingency plan.
Many retirees today still have decades left to be productive in the workplace. According to Northwestern Mutual’s 2020 Planning & Progress Study, one in five (21%) U.S. adults expect to work past the traditional retirement age of 65. Among those who do, nearly half (45%) say it’s because of necessity and 55% say it’s because of choice.
Whether choosing semi-retirement or turning to gig work as a backup plan, seasoned executives enjoy the flexibility and rewards of fractional work.
Why do companies hire fractional executives in 2021?
It’s relatively simple. Fractional executives can be a good fit for organizations that don't need or can't afford a permanent, full-time leader, but would benefit from the knowledge and strategic leadership that an experienced, and accomplished executive could bring to the company.
Beyond serving as an addition to the C-suite, fractional executives could offer other services to their clients, such as advising the CEO on related issues and opportunities, managing strategic initiatives, conducting strategy workshops, coaching/mentoring staffers, or conducting audits.
And as mentioned earlier, emerging growth companies, as well as startups, often bring in a fractional COO, CFO, CMO or other executive on an “other than full-time basis”, because the company couldn’t afford or couldn’t make use of their skills on a full-time basis. The fractional executive provides strategy and direction - two elements that are critical for companies in early stages of development.
About the Author
Robert Curtis is an executive with 12 startups under his belt. He has had numerous successful exits during his 30 plus years as a senior executive. Robert is on the GigX, Inc. Advisory Council and had his hand in developing the company’s business plan and financial projections. GigX is a startup company and is quickly becoming the number one global Network for independent consultants and is based out of Irvine, CA.
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