In 2016 flexible work was recognized as one of the biggest drivers of transformation in the workplace by World Economic Forum 1 and we are already seeing its impact on the way we work. It also became clear that maintaining flexibility properly is crucial for today’s organisations. 89% of professionals surveyed by International Workplace Group in their recent ‘The Workplace Revolution: Reaching the Tipping Point’ global survey believe that flexible working helps their business grow – a share that has considerably increased from 68% in 2016.2 Work habits are changing parallel to lifestyle and it is not idle chatter. Personal productivity is becoming a key driver for flexible working and enabling employees to work from anywhere helps to retain top talent and supports the recruitment process, as stated by 80% of respondents. Macroeconomic impact is also evident – annual savings for the U.S. economy could be as high as $15bn if all companies adopted work flexibility, according to ‘Finding Time: The Economics of Work-Life Conflict’ by Heather Boushey.3
Recently published estimates on alternative work arrangements by the Bureau of Labor Statistics shows that 3.8% of total employment in May 2017 comes from the contingent workforce.4 10.1% of all employees participated in alternative arrangements as independent contractors or as on-call or temporary help agency workers. Of course, these numbers overlap to some extent, however, they correspond to the scale of underutilization of the workforce and the underemployment phenomenon. Interestingly, degree holders make up 43.5% of all contingent workers. Another 1.0% of total employment (1.6 million) was made up of electronically mediated workers i.e. Uber drivers or handyman TaskRabbit workers.5 Here, the share of workers with bachelor’s degree or higher is equal to 67%.
Source: Contingent and Alternative Employment Arrangements, Bureau of Labor Statistics, June 2018
Underutilized potential of the workforce is a real pain in the neck for employers and is causing many challenges. Let’s face the facts: we live in times when access to natural light is the number one desired office perk 6, ‘sitting is a news smoking’ 7 and deskwork-driven fatigue are being analysed by psychologists.8 And if you experience a lack of light or exhaustion, you can always outsource quitting your job.9 All that means that times get tougher for employers.
Data from the Bureau of Labor Statistics shows that the number of involuntary part-time workers – due to slack work, business conditions, inability to find full-time work or involved in seasonal work – has been declining since 2009 and is likely to fall far below pre-financial crisis levels in the near future. Much more compelling could be that part-time employment for non-economic reasons sustains in upward trend. Over last 10 years, number of voluntary part-time workers in the U.S. increased by 1.9 million and is currently at its peak of 21.5 million. One can guess why this voluntary contingent work has grown, but 10 years after the crisis and especially during a period of economic welfare, people are not forced to work less by employers, they just choose to do so. Supposedly, at least a fraction of them are underemployed.
Results from the recent Morning Consult’s survey shows that belonging to the gig economy does not affect the level of satisfaction from an individual’s job, financial situation and family life – and for some aspects it is even higher for the gig workforce than the regular workforce.10 Gig workers are more satisfied with their pay, work-life balance and ability to improve their skills and education at work.
The majority of surveyed U.S. employees are in favour of agile employment over payroll. 51% would choose more flexibility and shorter hours, even if it meant less pay than elsewhere, to have more time for themselves and their families. No wonder that for post-graduates (59%) and $100k+ earners (58%) it seems even more valuable. There may be also some signs that Millennials have had enough of gig economy – among age groups, they have the highest percentage (53%) of those who would prefer to work full-time if given the opportunity.
Source: National Tracking Poll #180825, Morning Consult, August 2018
For companies, it is not always easy to adapt to the changes in the workforce and allow employees to be flexible. According to studies and surveys, barriers lie within the companies themselves. Organizational culture not allowing to take advantage of new work optimization technologies and strategies is the #1 obstacle for 72% of professionals surveyed by Ardent Partners.11 Moreover, technology itself is ageing quickly and the shift to agile work is delayed by legacy applications, according to 56% of CIOs surveyed by Capita.12 Embracing a cultural change and developing capabilities for new technologies along with prioritizing flexible work is the way for those companies which would like to benefit from the advance of employees’ preferences.
Along with the changing habits and technology impacting the way we work and all work processes, jobs are becoming more intellectual and creative and the downward trend in working hours per week continues. A Futuristic view is that work will decline to 20 hours per week before the end of 21st century. 13 Before that will (or won’t) happen, work will continue to become more independent. By 2027 it is expected that the majority of the U.S. workforce will be freelancers.14 One point is certain. The only constant is change, especially in the workplace.
Karol Rybaczuk is an economist and the business research analyst for the Global Knowledge Center. Using his experience in CRE research and economic analysis, he forecasts and analyzes future business trends. Karol has a masters’ degree in quantitative methods in economics, a background in investment banking, and also authors an economic forecast column for a leading newspaper in Poland.